Something important is happening beneath the noise of crypto headlines — and it has little to do with memecoins or market speculation. Stripe recently reintroduced stablecoin payments after a multi-year hiatus. Meta, once burned by its own stablecoin ambitions, is quietly testing integration of U.S. dollar stablecoins from other issuers in WhatsApp. These are not fringe tech experiments. They’re signs that dollar-backed digital assets are beginning to reenter the mainstream. And while the policy debate often focuses on consumer protection or regulatory jurisdiction, there’s another angle that deserves urgent attention: national security.
At their core, stablecoins are digital representations of U.S. dollars (or similarly safe assets, like gold or other stable fiat currencies) issued on blockchains. As of Q2 2025, the total supply of dollar-pegged stablecoins exceeds $200 billion. According to a recent report by the World Economic Forum, stablecoins facilitated over $27.6 trillion in transactions in 2024, surpassing the combined volumes of Visa and Mastercard. Two issuers — Tether and Circle — dominate the space, with combined reserves consisting heavily of U.S. Treasury bills. Tether alone reportedly held over $93 billion in U.S. Treasuries earlier this year, placing it among the world’s top holders of short-term U.S. government debt.
That makes stablecoins more than just a crypto tool — they are digital demand engines for U.S. sovereign debt. Pause and consider that: as some nations attempt to move off dollar rails, USD stablecoins provide a path for vastly expanding dollar payments by delivering US debt directly to citizens of all nations. Each new stablecoin minted requires reserve backing, often in the form of Treasuries. This contributes to liquidity in the U.S. debt market at a time when global buyers are showing signs of hesitation. Several emerging markets, and even longstanding allies, have floated the idea of diversifying away from the dollar. Stablecoins quietly counter that trend, extending demand for U.S. assets even in jurisdictions where traditional capital markets don’t reach.
They also extend something harder to quantify but more strategically vital: influence. In countries with capital controls or currency instability — like Turkey, Venezuela, and Nigeria — stablecoins have become lifelines. People use them to preserve value, transact with less friction, and, in many cases, escape volatile or corrupt local banking systems. When users in these countries adopt USDC or USDT, they are plugging into the dollar system — potentially without the need for local intermediaries, without embassies, and without needing physical greenbacks. It is dollarization by code. It gives each and every individual on the planet the ability to opt in to the U.S. financial system.
This matters because the global financial system is fragmenting. The rise of central bank digital currencies (CBDCs) — especially China’s digital yuan — is part of a broader effort to build alternative rails for cross-border settlement. As of 2023, China had distributed its e-CNY to over 260 million users and signed cross-border pilot agreements across Asia and Africa. At the same time, the share of U.S. dollars in global foreign reserves continues its slow erosion, now hovering around 58%, down from over 70% two decades ago.
Stablecoins offer a digital counterbalance to these trends. They embed the dollar into the next generation of financial infrastructure — payment platforms, DeFi protocols, and digital wallets. And unlike Eurodollars (U.S. dollar-denominated deposits held in banks outside the United States, beyond the reach of U.S. banking regulations and often used in opaque, offshore financial markets), stablecoins often operate on public ledgers. That gives the U.S. a visibility advantage. When reserves are custodied domestically, when issuers operate in the U.S. and their customer data is available to us, and when transactions occur on traceable blockchains, the U.S. gains both jurisdictional leverage and intelligence capacity. Stablecoins are not just currency — they are sensors in the global financial system. U.S. dollar — and especially U.S. domiciled — stablecoins give us the most valuable currency: data.
This capacity has national security implications. Sanctions enforcement, illicit finance tracking, and crisis response all depend on knowing where value is moving. When adversaries — from sanctioned states to cybercriminal networks—use dollar stablecoins, those flows can be traced, frozen, or redirected. The infrastructure built around these assets becomes a tool for enforcement as much as innovation.
To be clear, stablecoins are not risk-free. A loss of confidence in a major issuer could create market shocks if a stablecoin was unregulated or improperly managed. Poor reserve management could undercut credibility. But those are solvable challenges. What matters now is recognizing what’s already true: stablecoins are reinforcing dollar dominance, funding U.S. debt, and extending financial influence far beyond our borders.
The U.S. has a history of exporting its power through finance. Stablecoins are the next evolution of that legacy. And with the world watching, and competitors mobilizing, we have a rare opportunity to lead from a position of strength.
Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc. or its owners and affiliates.