Standard Chartered's latest report presents an interesting perspective on how the expansion of the stablecoin market could impact the U.S. financial system.

In short, it predicts that by the end of 2028, the market capitalization of stablecoins will reach $2 trillion. As of early 2026, it's about $300 billion to $320 billion, indicating significant growth. Along with this growth, the new demand for short-term government bonds from stablecoin issuers is expected to rise from $0.8 trillion to $1.0 trillion.

Major issuers like Tether and Circle already hold hundreds of billions of dollars in short-term government bonds. These serve as reserve assets backing the value of their tokens, and as the market grows, this demand will accelerate further. Essentially, capital related to cryptocurrencies is flowing into U.S. government fiscal funds.

What's important here is that, combined with the Federal Reserve's expected purchase amount of $1.2 trillion, the total demand for short-term government bonds by 2028 could reach approximately $2.2 trillion. Meanwhile, the supply is projected to be about $1.3 trillion. This could create a demand-supply gap of around $900 billion.

Standard Chartered analysts point out that the Treasury Department might respond to this increased demand by raising the issuance ratio of short-term government bonds. If they increase it by 2.5 percentage points over three years, an additional supply of about $900 billion could be achieved, potentially filling this gap. In that scenario, the suspension of 30-year bond auctions might also be considered.

However, the growth of the stablecoin market has recently stalled. Growth has slowed after surpassing $300 billion, affected by falling crypto prices and the impact of the GENIUS Act. Bitcoin, for example, has fallen more than 50% from its October high last year, and these headwinds are temporarily restraining market expansion.

Nevertheless, Standard Chartered views these declines as cyclical. In the long term, the growth of the stablecoin market could significantly alter the demand for U.S. short-term government bonds, potentially leading to a restructuring of the entire interest rate market. The future movements in the short-term bond market are closely linked to the growth of the crypto market.