politics

NEW: As President Trump's tariff strategy plays out, it's becoming clearer that crypto will play a leading role

At the same time Trump was in the Rose Garden, a House Committee passed a critical stablecoin bill

I chatted Tether CEO Paolo Ardoino to uncover the link 🧵

Award-winning Host of @Coinage covering crypto for a mainstream audience | Fmr. YahooFinance Anchor & Harvard Econ Grad | Co-Own Coinage with me 🫡

Trump has sought to achieve taking on China while also maintaining a couple things:

- The dollar remaining the chosen reserve currency around the world

- The US government being able to borrow for cheaper than it otherwise would

But what if China isn't there to buy US debt?

Enter stablecoins, the digital dollars on the blockchain that can exist anywhere and everywhere

Tether, the largest, has a market cap of ~$150 Billion. They made $13 billion in profits last year

They also nearly matched *THE UK* in terms of how much US debt they bought in 2024

And as the US takes on China around the world, stablecoins like Tether will play an interesting role:

As Paolo tells me, they buy US debt and get dollars in the hand of people in emerging markets

That's more powerful than just having a nation state buy US debt

Why?

Having a stablecoin in your wallet gives people direct access to dollars. They use, save, spend, think in dollars

In El Salvador, where Tether is based, the economy is already dollarized

Nonetheless, China paid $55 million to fund a national library to stamp China's name on it

If there is a man who understands the significance of stamping a name on the side of a building, it might be Trump

It's a microcosm, but Trump thinks that if the US is going to take on China it must be now. And he'll need a bidder of US Debt

Hence, Congress passing stablecoins

As I covered for @coinage that's also the reason behind the Trump family launching their own stablecoin, USD1

As Congress passes the stablecoin bill, issuers will be required to back them with US debt/cash

If tariffs lose nations to buy US debt, you turn to their people

As Paolo explains, the idea of democratizing America's $36 Trillion in debt via stablecoins is not that crazy. That's $100K per American, or:

"Find 3.6 billion people, each one of them will hold $10,000 $USDT and you cover the entire US debt. Seems crazy. Not that crazy"

READ/WATCH/OWN what's really going on with stablecoins in DC in our latest episode:

READ/WATCH/OWN what's really going on with stablecoins in DC in our latest episode: https://www.youtube.com/watch?v=YOR1y3zF7Y8

One thing is extremely clear: Trump is taking on China head first

He's using tariffs to bring China to the table as China has increasingly grown its sphere of influence around the world:

Look at the Panama Canal
Look at El Salvador

But China holds nearly $1T in US Debt 🔫

Interesting and thoughtful post!
At least there is some silver lining to this past week