PANews June 21 news, according to CNBC, stablecoins may become a new tool for U.S. Treasury Secretary Yellen to address the country's deficit. Yellen previously expressed appreciation for the GENIUS Act and stated that a regulated and evolving stablecoin market could create new buyers for U.S. government debt, boosting private sector demand for U.S. Treasuries. Yellen had previously indicated to the U.S. House Financial Services Committee in May that some speculate the demand for U.S. government securities from the stablecoin market could reach as high as $2 trillion in the coming years.
However, analysts believe that the stablecoin industry is unlikely to fully resolve the U.S. government's debt financing issues and may introduce additional risks, as the extra demand for stablecoins will take time to develop. Meanwhile, the U.S. Treasury may need to issue a significant amount of debt securities within a year. If issues arise that prevent the Federal Reserve from lowering interest rates, the U.S. deficit could spiral out of control.