Standard Chartered: Stablecoins Could Cut 30-Year US Bond Issuance

Standard Chartered projects stablecoin issuers could create $800 billion to $1 trillion of new demand for Treasury bills by the end of 2028. When combined with Federal Reserve purchases, total short-term Treasury demand could reach $2.2 trillion. Two-thirds of that T-bill demand is expected to come from emerging market stablecoins, representing net new capital, while developed-market stablecoins largely substitute existing holdings.

The bank warns the Treasury could respond by increasing T-bill issuance and reducing long-term bond supply, potentially suspending all 30-year bond auctions for up to three years. “We think the US Treasury may use this potential excess demand as a reason to issue more T-bills,” wrote Geoff Kendrick in the latest Standard Chartered report, highlighting stablecoin issuers as increasingly significant buyers of short-term US debt.

Standard Chartered notes that shifting roughly $9 billion from long-term bonds to T-bills could initially flatten the US Treasury curve.

United States

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