A Fed governor said the rapid rise of stablecoins could push long-term interest rates lower as demand for Treasury assets grows.
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Posted November 10, 2025 at 9:16 am EST.
Federal Reserve Governor Stephen Miran stated that stablecoin expansion could drive down the neutral interest rate over the next five years. Speaking at the BCVC summit in New York, the Trump-appointed official said dollar-pegged tokens are applying downward pressure on r-star, the rate that neither stimulates nor restrains economic activity.
Fed research projects the stablecoin market could surge from its current $310 billion market cap to $3 trillion within five years. Miran argued this growth boosts demand for U.S. Treasury bills and liquid dollar assets from international buyers, prompting the central bank to lower rates accordingly.
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He praised the GENIUS Act for establishing clear guidelines and consumer protections, calling the regulatory framework crucial for broader adoption. The legislation mandates U.S. issuers maintain reserves backed one-to-one with safe, liquid dollar assets. Banking groups and the International Monetary Fund have warned that stablecoins could compete with traditional financial services for customers.
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