State Street Global: Stablecoins will bring significant incremental demand for U.S. Treasuries.

According to Gate News bot, Reuters reported that at a money market fund conference held in Boston this week, stablecoins may drive a surge in demand for short-term U.S. Treasury bonds, becoming a hot topic. Attending investors expect that later this year, stablecoins will absorb a large amount of U.S. Treasury supply. Stablecoins are typically pegged to high liquidity assets like the U.S. dollar, and to maintain a 1:1 value peg, their issuers need to hold substantial amounts of highly liquid safe reserves, which often means purchasing U.S. Treasury bonds.

Yie-Hsin Hung, CEO of State Street Global Advisors, stated that stablecoins are attracting significant demand in the U.S. Treasury market. Currently, about 80% of the stablecoin market is invested in U.S. Treasury bills or repurchase agreements, totaling approximately $200 billion. Although this accounts for less than 2% of the entire U.S. Treasury market, the growth rate of stablecoins is rapid and is likely to surpass the growth of U.S. Treasury supply.