Standard Chartered: Stablecoins may drive demand for $1 trillion in US Treasury bonds, US Treasury may adjust issuance structure According to The Block, stable currency issuers are becoming the largest potential buyers of US treasury bond bills (T-bills), which is expected to profoundly affect the US debt financing pattern in the coming years. According to Standard Chartered Bank's analysis, as the market value of stablecoins may reach $2 trillion by the end of 2028, issuers will increase their demand for short-term US bonds by approximately $0.8 to $1 trillion, which will be used as reserve assets. If the current issuance model remains unchanged, this demand may lead to a supply and demand gap of approximately $0.9 trillion in US Treasury notes over the next three years. At present, the supply of stablecoins is about 300 billion US dollars, and the growth has slowed down due to the sluggish cryptocurrency market and slow regulatory progress under the GENIUS Act. However, analysts believe that this is a cyclical rather than structural factor. The GENIUS Act requires the United States to regulate and stabilize the currency to hold high-quality liquid assets, of which short-term treasury bond is the core. Standard Chartered expects that by 2028, two-thirds of the increase in the stable currency market will come from emerging markets, which will generate new T-bill demand, while the growth in developed markets will mainly replace the existing treasury bond allocation. At the same time, the Federal Reserve's reserve management purchases may also generate approximately $500 billion to $600 billion in additional front-end demand, coupled with the replacement of maturing mortgage-backed securities, the overall demand for new notes may reach approximately $2.2 trillion. In contrast, if the proportion of bills to total debt remains unchanged, the expected net supply is only about $1.3 trillion, with a shortfall of about $0.9 trillion. The Ministry of Finance has indicated that it may adjust the debt structure to meet demand. Analysis shows that increasing the proportion of bills by only 2.5 percentage points can add approximately $0.9 trillion in new bill issuances within three years, thus filling the gap. This may be achieved by reducing the issuance of long-term treasury bond. The 30-year bond auction can be suspended every year, similar to the 2002-2006 U.S. debt strategy, but the budget surplus at that time was significantly different from the current deficit level of 5% -6%. The analysis points out that this structural adjustment may lead to a bull market at the short end of the yield curve of treasury bond, but Standard Chartered still expects that the curve will become bearish and steep in the next year, with a 10-year yield of about 4.6% at the end of the year. Investors should pay attention to the potential risks brought by the shortage of front-end notes and changes in issuance models. The macro impact of stablecoins is becoming increasingly significant. Tether USDt, the world's largest issuer of stable currency, holds more than 120 billion US debt notes, ranking among the world's top short-term treasury bond bonds. CEO Bo Hines said that further expansion is possible. The study also suggests that the growth of stablecoins may lead to a loss of up to $500 billion in bank deposits, driving funds from the traditional banking system to the government bond market. At the same time, the GENIUS Act and relevant guidance from the SEC accelerate the regulation of stablecoins, and the industry and White House officials continue to negotiate market structure and yield based stablecoin policies. At the consumer level, the use of stablecoins has entered daily life, including savings, retail payments, and daily transactions, demonstrating its increasing penetration in the global economy.