The Unseen Rise of Stablecoins: Bolstering US Global Influence

A significant development is unfolding beneath the surface of crypto news, one that has little to do with speculative market trends or meme-based currencies. The recent reintroduction of stablecoin payments by Stripe, following a hiatus, and Meta's discreet testing of US dollar stablecoin integrations from other issuers in WhatsApp, signal that dollar-backed digital assets are making their way back into the mainstream. While policy discussions often focus on consumer protection and regulatory oversight, another critical aspect warrants immediate attention: national security. At their core, stablecoins represent digital versions of the US dollar (or similarly stable assets like gold or other fiat currencies) issued on blockchain platforms. As of Q2 2025, the total supply of dollar-pegged stablecoins has surpassed $200 billion, with a recent report by the World Economic Forum indicating that stablecoins facilitated over $27.6 trillion in transactions in 2024, outpacing the combined volumes of Visa and Mastercard. The dominance of two issuers, Tether and Circle, with combined reserves heavily composed of US Treasury bills, underscores the significant role stablecoins play in the digital economy. Tether alone reportedly held over $93 billion in US Treasuries earlier this year, positioning it among the world's top holders of short-term US government debt. This makes stablecoins more than just a crypto tool; they serve as digital engines driving demand for US sovereign debt. The implications are profound: as some nations seek to reduce their reliance on the dollar, USD stablecoins provide a pathway for vastly expanding dollar payments by directly delivering US debt to citizens worldwide. Each new stablecoin minted requires reserve backing, often in the form of Treasuries, contributing to liquidity in the US debt market at a time when global buyers are showing signs of hesitation. Several emerging markets and even long-standing allies have considered diversifying away from the dollar, but stablecoins quietly counter this trend by extending demand for US assets into jurisdictions where traditional capital markets have limited reach. Furthermore, stablecoins extend a more intangible but strategically vital influence. In countries plagued by capital controls or currency instability, such as Turkey, Venezuela, and Nigeria, stablecoins have become essential lifelines. Individuals use them to preserve value, conduct transactions with less friction, and often escape volatile or corrupt local banking systems. When users in these countries adopt USDC or USDT, they are effectively plugging into the dollar system, potentially bypassing the need for local intermediaries, embassies, or physical US currency. This phenomenon represents dollarization by code, offering every individual on the planet the ability to opt into the US financial system. The significance of this development cannot be overstated, especially as the global financial system undergoes fragmentation. The rise of central bank digital currencies (CBDCs), notably China's digital yuan, is part of a broader effort to establish alternative rails for cross-border settlement. By 2023, China had distributed its e-CNY to over 260 million users and signed cross-border pilot agreements across Asia and Africa. Meanwhile, the share of US dollars in global foreign reserves continues to erode slowly, now hovering around 58%, down from over 70% two decades ago. Stablecoins offer a digital counterbalance to these trends, embedding the dollar into the next generation of financial infrastructure, including payment platforms, DeFi protocols, and digital wallets. Unlike Eurodollars, which are US dollar-denominated deposits held in banks outside the US and beyond the reach of US banking regulations, stablecoins often operate on public ledgers, providing the US with a visibility advantage. When reserves are custodied domestically, issuers operate in the US, customer data is available, and transactions occur on traceable blockchains, the US gains both jurisdictional leverage and intelligence capacity. Stablecoins are not just currency; they are sensors in the global financial system, offering the US the most valuable currency: data. This capacity has profound national security implications. The enforcement of sanctions, the tracking of illicit finance, and crisis response all depend on understanding the flow of value. When adversaries, including sanctioned states and cybercriminal networks, use dollar stablecoins, these flows can be traced, frozen, or redirected. The infrastructure built around these assets becomes a tool for enforcement as much as innovation. While stablecoins are not without risks, such as the potential for market shocks if a major issuer loses confidence or is improperly managed, these challenges are solvable. What is crucial now is recognizing the current reality: stablecoins are reinforcing dollar dominance, funding US debt, and extending financial influence far beyond US borders. The US has a history of exporting its power through finance, and stablecoins represent the next evolution of this legacy. With the world watching and competitors mobilizing, the US has a rare opportunity to lead from a position of strength.