Standard Chartered projects $1T Treasury bid as stablecoin demand reshapes US debt

Digital assets are quietly reshaping US government financing as rising stablecoin demand channels vast pools of capital into Treasury markets.

Standard Chartered’s $1 trillion Treasury projection

New research from Standard Chartered argues that the booming stablecoin sector could generate up to $1 trillion in fresh demand for US Treasury bills by 2028, creating a powerful new structural buyer of public debt.

As large issuers expand, they are expected to become major purchasers of government securities, effectively turning digital dollars into a serious force inside traditional finance. Moreover, this shift could alter how the US funds itself over the coming years.

Key figures behind the stablecoin-driven Treasury bid

Analysts at Standard Chartered project that total stablecoin market cap could surge to $2 trillion by the end of 2028, up from roughly $300 billion today. That trajectory implies a multi-fold expansion of tokenized dollar liquidity.

However, the bank warns that issuers are likely to absorb approximately $1 trillion in short-term T-bills, which could create a potential supply shortfall if the US Treasury does not adapt issuance patterns to this new source of demand.

The report links this to the evolving regulatory framework in the United States. Under the GENIUS Act, stablecoin operators must hold reserves primarily in high-quality liquid assets, pushing portfolios heavily toward the 0–3 month segment of the short dated Treasuries market.

Why stablecoins are becoming a financing powerhouse

Stablecoins have evolved far beyond their initial role as trading chips on crypto exchanges. Instead, they are increasingly functioning as steady buyers of US government debt, embedding crypto infrastructure into global fixed-income flows.

After the GENIUS Act passed in July 2025, regulated issuers were required to back their tokens with assets such as short-dated US Treasuries. That said, this rule change effectively hardwired demand for high-quality liquid collateral into the architecture of major stablecoins.

Supply of outstanding tokens remains near $300 billion today. Standard Chartered sees the recent slowdown in growth as temporary and expects renewed expansion, particularly as demand accelerates in emerging markets where access to dollars is constrained.

Moreover, the bank highlights how users in high-inflation countries increasingly shift savings into dollar-linked tokens. As capital flows into these instruments, the digital dollar reserves that back them are directed into US public debt, providing a persistent and often overlooked support for Treasury markets.

Breaking down the $1 trillion projection

Standard Chartered analysts Geoffrey Kendrick and John Davies outline the mechanics behind their forecast in detail, linking token issuance to reserve allocation along the yield curve.

They expect stablecoins to grow toward a total market capitalization of $2 trillion by 2028. Based on current reserve structures, that expansion alone could create $0.8–1.0 trillion in incremental buying of short-dated Treasury bills, concentrated at the very front end.

In practical terms, the analysts argue that large issuers could emerge as some of the biggest buyers of short dated US Treasuries worldwide. If issuance patterns remain unchanged, the report points to roughly $0.9 trillion in excess demand for T-bills over the next three years.

About two-thirds of that projected growth is expected to come from emerging markets demand, where local savers often prefer dollar-linked instruments over domestic currencies. Crucially, most of this would represent net new buying rather than a simple reshuffling of existing Treasury portfolios.

According to the authors, this amounts to a structural bid forming under US debt, with stablecoin demand acting as a continuous source of liquidity for the front end of the curve.

Implications for US debt issuance and policy

The projected scale is large enough that the US Treasury can no longer treat stablecoins as a niche phenomenon. Instead, they now intersect directly with core questions of US debt financing and market stability.

If supply does not adjust, the analysts warn that short-dated T-bills could become increasingly scarce. However, Treasury officials may respond by shifting issuance toward the front end, in order to accommodate these new buyers and avoid heightened treasury bill scarcity.

Treasury Secretary Scott Bessent has already signaled that stablecoins may soon become an important channel for financing the US government. This creates a two-way benefit: the dollar strengthens its presence in digital markets, while the state secures a growing, programmatic buyer base.

That said, deeper integration also means closer oversight. As new genius act regulation and related rules advance, coordination between private stablecoin issuers and public debt managers is likely to intensify, tightening the link between on-chain liquidity and federal funding needs.

Collateral models and the future of digital dollar finance

Innovation around collateral structures is accelerating, with experiments ranging from tokenized deposits to diversified money-market style portfolios. However, short-dated Treasuries still sit at the center when it comes to regulatory acceptance and risk management.

Moreover, policy makers appear keen to ensure that reserves remain concentrated in the safest segments of the curve, reinforcing the role of T-bills as the primary asset backing major dollar tokens. This design choice keeps the system anchored to established benchmarks.

In summary, stablecoins are evolving into a strategic funding channel for the US, with their growth trajectory closely tied to Treasury issuance, regulatory choices, and the broader globalization of digital dollar use.