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Stablecoin issuers hold large amounts of US Treasury bonds, potentially impacting the stability of the US economy and banking industry.
[Chain News] PANews reported on August 9 that Circle and some stablecoin issuers are absorbing more U.S. Treasury bonds than most countries, which could reshape the U.S. economy. One stablecoin issuer disclosed that it holds more than $100 billion in U.S. Treasury securities, surpassing countries like the UAE and Germany. However, while cryptocurrency supporters believe that stablecoins will help solidify the dollar's dominance globally, critics warn that even if stablecoins represent only a small part of the overall market, they could lead to financial instability in the banking sector, as stablecoins might siphon funds away from bank deposits, and since deposits are a necessary liquidity for loans, stablecoins could pose a threat to the credit system.