Why Trump's team is betting on stablecoins

The administration sees these digital assets as a tool in the fight against de-dollarisation.

- Gillian Tett

A year ago, Mr Stephen Miran, former chairman of the Council of Economic Advisers under US President Donald Trump and now a Federal Reserve governor, wrote a paper that caused a frisson in the financial markets.

Mr Miran suggested, in a spirit of Socratic debate, that Mr Trump could use tariffs and a “Mara-Lago” currency accord to bolster American dominance — an idea which provoked horror among progressives and free-market economists alike.

Twelve months on, Mr Trump has obviously embraced tariffs. And while the Mara-Lago currency vision has faded from view, Mr Miran is now tossing out new ideas — and his opponents should take note. For he thinks we are about to see a notable shift in financial flows that could affect dollar usage and interest rates. Call this, if you like, a new chapter in geofinance — or American financial imperialism.

The crucial issue is stablecoins, or cryptocurrencies backed by other assets. Until recently, many financiers dismissed these as a sideshow or, worse, a criminal tool. No wonder: Tether, the largest stablecoin issuer, has previously faced legal censure. However, the Trump administration has backed stablecoins. Not uncoincidentally, Mr Howard Lutnick, the Commerce Secretary, has ties to Tether. And Congress recently adopted a stablecoin regulatory framework, the Genius Act.