That's not how any of this works. You may not receive any interest on your stablecoin balance, but the issuer certainly does. Why would they offer to lend money to the US government at zero when they can get the market rate and pocket it? What's more, these are mostly short-term instruments This means any increase in inflation will be reflected in their yield.

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JumpCrisscross a day ago | parent [-]

> You may not receive any interest on your stablecoin balance, but the issuer certainly does

A bunch of zero marginal cost capital funding purchases of U.S. debt would absolutely push down rates, possibly lower than inflation, because if you’re a stablecoin issuer you’re not constrained by yield.

This is a dumb-money venture. And if there is this much money that is this dumb, Treasuries aren’t the worst place for it to go.

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cortesoft a day ago | parent | next [-]

Even if every dollar of market cap for every crypto currency in the world was invested into us treasuries, it would still be a drop in the bucket and wouldn't drastically change rates.

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NoahZuniga a day ago | parent | prev | next [-]

All those trilions and trilions of dollars of stablecoins sure are bringing down the us' cost to borrow.

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JumpCrisscross a day ago | parent [-]

> those trilions and trilions of dollars of stablecoins sure are bringing down the us' cost to borrow

If you think trillions of dollars in de novo price-insensitive demand doesn’t move a market, even one as deep as the Treasury market, I’ve got a stablecoin to sell you.

	▲	NoahZuniga a day ago \| parent [-]
		Yes, trillions of dollars of new price-insensitive demand would move the treasury market. That's why I named that number! But, there just isn't that much value in stablecoins.

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ac29 21 hours ago | parent | prev [-]

>A bunch of zero marginal cost capital funding purchases of U.S. debt would absolutely push down rates

There is a floor to short term treasury rates because the Fed also runs overnight repo operations linked to the Fed funds rate