In a notable shift of strategy, U.S. officials are now prioritizing the regulation of stablecoins over the establishment of a Strategic Bitcoin reserve. This pivot underscores a growing belief that well-regulated, dollar-backed digital currencies can strengthen the U.S. dollar’s position globally while offering a safer investment alternative.
On February 6, 2025, key lawmakers—Financial Services Committee Chairman French Hill and Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee Chairman Bryan Steil—unveiled a draft bill aimed at setting clear rules for the issuance and management of USD-pegged stablecoins. Under this proposal, stablecoin issuers would need approval from the Office of the Comptroller of the Currency (OCC) and would be required to back each token with cash, short-term U.S. Treasury bills, or central bank reserves on a one-to-one basis.
Senate Banking Committee Chairman Tim Scott has also weighed in, highlighting that regulated stablecoins could improve financial inclusion by making the U.S. dollar more accessible in regions with limited banking infrastructure or unstable local currencies.
This new regulation, known as the STABLE Act, is part of a broader legislative effort that includes another bipartisan initiative—the GENIUS Act—which targets stablecoins with market caps exceeding $10 billion.
The upcoming rules could have serious implications for major players like Tether. According to JPMorgan analysts, Tether might face pressure to sell some of its Bitcoin holdings to meet these stricter backing requirements, as current figures suggest it is only partially backed.
Industry experts, such as Jeff Park of Itwise, argue that stablecoins offer significant advantages over Bitcoin when it comes to spreading the U.S. dollar’s value around the world. He points out that while a stablecoin’s price remains constant, its global use can drive up international demand for the dollar, ultimately boosting its value.
Fed Governor Christopher Waller echoed these sentiments during a recent conference in San Francisco, stressing the potential of stablecoins to extend the reach of the U.S. dollar internationally—though he cautioned that the success of this initiative will depend heavily on the robustness of the regulatory framework.
Recent developments in the crypto market add further weight to this focus. For example, Ripple’s new stablecoin, RLUSD, has quickly amassed a market cap of $100 million, and Mastercard reported that approximately 30% of its 2024 transactions were tokenized via blockchain technology. These examples illustrate how stablecoins are poised to disrupt traditional financial systems.
As U.S. policymakers work to finalize these regulations, investors and industry watchers are keeping a close eye on how the stablecoin market will evolve. This new regulatory push could well signal the beginning of a more stable and accessible era in digital finance—one that favors the steady value of the U.S. dollar over the volatility of cryptocurrencies like Bitcoin.
