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Donald Trump Jr said the explosion of stablecoins this year would help reinforce the US dollar’s dominance as the global reserve currency despite shifting geopolitics.
Trump Jr, the eldest son of the US president and a leading proponent of America’s embrace of crypto assets, said the surge in demand for stablecoins backed by the dollar was providing a ballast to sales of US debt.
“Crypto is actually going to be the thing that preserves dollar hegemony around the world,” said Trump Jr at a private meeting during a crypto conference in Singapore on Wednesday.
“As stablecoins start becoming the markets and treasuries, that’s going to replace China and Japan and some of these places that say, ‘You know what? We don’t want America to have that power anymore.’
“This is going to backfill a deficit created by those countries who are trying to get away from that.”
Trump Jr warned that future governments could reverse many of the current administration’s pro-crypto reforms.
“What we have to do is we have to get firmly entrenched, we have to have people all in to make it too big for them to essentially try to take over.”
US Treasuries suffered sell-offs earlier this year following President Donald Trump’s announcement of sweeping tariffs on America’s global trade partners. The moves fuelled fears in Washington that China could retaliate by selling its huge holdings of US debt.
Stablecoins have surged in popularity following a change of US regulations over the summer that helped legitimise the asset.
The so-called Genius Act, designed to create a regulatory framework for the stablecoin industry, passed through Congress in July. The $300bn market has grown more than 40 per cent this year, twice as fast as the broader crypto industry, according to JPMorgan.
About 99 per cent of the stablecoin market is backed by US dollars, the bank said.
Richard Teng, chief executive of Binance, the biggest cryptocurrency exchange, said the Genius Act had played a huge role in boosting the stablecoin market.
“By virtue of the US being so supportive of that, it’s going to continue to create strong demand and hegemony of the US dollars,” he told the Financial Times.
The Trump family has launched a series of crypto ventures over the past year, including World Liberty Financial, which created a stablecoin called USD1.
Trump Jr and his brother, Eric, also recently listed a crypto mining company called American Bitcoin.
Following the listing, Eric Trump told the FT that increasing demand for cryptocurrencies could “save the US dollar” by attracting investment flows from around the world into the US.
The initiatives were launched at a time when Donald Trump was overseeing an administration aimed at making the US the “crypto capital of the world”. The US president also has a memecoin, a type of crypto token with no functions beyond being a vehicle for speculation, called $TRUMP.
