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(7 Day Change as of April 24, 2025 2:15PM ET)
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Bitcoin Price: $93,287
9.43%
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DeFi Total-Value-Locked: $95.6B
6.46%
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Ethereum Price: $1,764
9.39%
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Crypto Market Cap: $2.92T
8.96%
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Bitcoin Range: $84,038 - $94,333
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TKN.U Close: $13.09 (as at Apr 23, 2025)
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Ethereum Range: $1,558 - $1,817
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Bitcoin Dominance: 63.40%
0.63%
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When China Closes a Door, Stablecoins Open a Window
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The Trump administration is pressuring trading partners to Buy American - American energy, defense and agricultural products, that is, and as the Wall Street Journal reports, many anxious global leaders, eager to placate the Commander in Chief and avoid a prolonged trade war, have voiced support for the idea.
However, just as foreign leaders are saying they’ll buy American goods and services, foreign investors, from Japanese pensioners to European mutual funds to State actors are letting their money do the talking - choosing to Sell American – specifically American stocks, corporate debt, and, worryingly, the treasury bonds America relies on to finance trillions in government spending.
Ross Perot gained political fame (or infamy, depending on who you ask) in the 1990s by arguing that the flow of factory jobs from the Midwest to Mexico from NAFTA would cause a “giant sucking sound going south.” We’re hearing a new sucking sound, but this time it’s capital, rather than jobs, that’s whooshing out the door.
Since the beginning of the year, the U.S. dollar has weakened against nearly every major currency, falling more than 10.5% against the Euro and Japanese Yen, and more than 7.5% against the British pound. And while U.S stock markets are reeling under pressure from Trump’s tariffs, European and British markets are up.
The biggest winner so far? Gold. Historically a refuge in turbulent times, the shiny metal has rallied 28% since the beginning of the year. According to LSEG Lipper data
, investors bought a net $11.13 billion in European equity funds and $3.64 billion in Asian equity funds. But U.S. funds saw a net outflow of $10.62 billion.
Some fear the damage from tariffs to American business, U.S. financial markets and even the dollar itself could be long lasting. “If
tariffs weigh on US firms’ profit margins and US consumers' real incomes, they can erode that exceptionalism and, in turn, crack the central pillar of the strong dollar,” according to Goldman Sachs strategist Michael Cahill.
“Global trust and reliance on the dollar was built up over a half century or more,” says Barry Eichengreen, an Economist and Professor at the University of Berkeley, adding “But it can be lost in the blink of an eye.”
Predictions that current policy will lead America down the road to ruin are probably overblown. But this dollar angst raises a pressing and real concern that the US could run out of buyers for its government debt as traditional investors shun treasuries along with other U.S. assets.
In a worst case scenario, China may even dump US debt intentionally to retaliate for tariffs, sending rates higher, impacting everything from car loans to mortgage payments. Treasury Secretary Scott Bessent tried to calm markets of these worries, saying "If a foreign rival were weaponizing the U.S. government bond market or attempting to destabilize it for political gain, I am sure that we would do something…but we just haven't seen that."
So, the U.S. needs to fund key government spending at reasonable rates of interest, but legacy buyers may not line up as eagerly in the future to buy the debt. So, now what?
The good news is that a new buyer of U.S. treasuries is emerging, made possible by the technology behind cryptocurrencies like Bitcoin.
Stablecoins, digital tokens backed fully by dollar reserves which operate on public, permissionless networks called blockchains, make moving money anywhere in the world as easy as sending a text message or email. Unlike legacy payment systems, they are cheap, frictionless, and peer to peer.
Blockchain-based stablecoins are now the 7th largest buyer of US government debt, exceeding Germany, Australia and other big countries. And they're growing quickly – surpassing $200 billion in size this year and now nearly $250 billion today.
Because stablecoins are fully backed 1:1 by dollar reserves, typically U.S. government debt, they are a persistent and growing buyer of new treasury issuances. Increasingly, government leaders see their potential. In a June 2024 opinion piece in the Wall Street Journal, former speaker of the house Paul Ryan said "Dollar-backed stablecoins are becoming an important net purchaser of U.S. government debt.”
To be sure, stablecoins are still a small piece of the enormous treasury market. But the trend suggests that stablecoins will continue to grow, perhaps capturing as much as 5%-10% share of the global money supply, or $5-$10 trillion, over the next decade. Jeremy Allaire, CEO of Circle, the largest American stablecoin issuer, said that the stablecoin market could reach $3 trillion by 2030. For context, a trillion stablecoin market would soak up more U.S. debt than China, Japan or the U.K., the three largest current owners of U.S. government debt, combined.
More profoundly, stablecoins can become a powerful and effective tool to export the U.S. dollar, helping it to maintain its reserve status. Most of the global population lacks a convenient way to move, store or earn U.S. dollars. Stablecoins fix that by upgrading the world’s decades-old financial infrastructure, making it easier, faster and cheaper for families and businesses to send, save, trade and spend their money. The U.S. has benefited enormously from the U.S. dollar being the global reserve currency. Despite accounting for about 25% of the world’s GDP, the greenback is involved in most of global trade. At White House Crypto Summit in February, Scott Bessent said “we are going to keep the US [dollar] the dominant reserve currency in the world, and we will use stablecoins to do that.” China and the rest of the world may be closing a door on America’s dollar and on an old regime where the U.S. relied on foreign governments to buy its debt. Stablecoins could be opening a window to its future.
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THIS WEEK ON DEFI DECODED
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Join Alex Tapscott and Andrew Young as they decode the world of Web3 with special guest Scott Melker, AKA the Wolf of All Streets. Listen in as they discuss Bitcoin’s decoupling and whether that theory holds any weight, the severe underperformance of altcoins, the impact of additional crypto ETFs and public equities on the markets, predictions for the second half of 2025, the broad implications of Trump’s tariffs on the U.S. economy, what’s going on with Ethereum, exciting sectors within the crypto asset class, and more.
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By: Jake Moodie
, Analyst, Digital Asset Group at Ninepoint Partners
Circle Launches Global Payments Network for Stablecoins, Set to Enable Mainstream Adoption of Stablecoins
Circle, the second largest stablecoin issuer, has
announced the launch of the Circle Payments Network (CPN), a global payments infrastructure that enables real-time, low-cost cross-border payments using regulated stablecoins like USDC and EURC. The network connects banks, payment providers, and digital wallets under strict regulatory standards, including licensing and AML compliance, to ensure security and trust. CPN supports various use cases such as supplier payments, payroll, remittances, and capital markets settlement, with a modular design that allows for future expansion and third-party development. Major global banks including Deutsche Bank, Santander, Société Générale, and Standard Chartered are advising on the network, which is set to begin limited rollout in May 2025. It was also announced that, in addition to Coinbase, Paxos, and BitGo, Circle is
actively pursuing a U.S. bank license as stablecoin legislation moves through the government.
Cantor, SoftBank, Tether, and Bitfinex Set to Launch $3 Billion Bitcoin Venture to Rival Strategy
Cantor Fitzgerald is
teaming up with SoftBank, Tether, and Bitfinex to launch a $3 billion Bitcoin investment venture. The goal is to create a serious competitor to Strategy (formerly MicroStrategy). The group is setting up a new firm called 21 Capital. It’s being built through Cantor Equity Partners, a special-purpose vehicle that raised $200 million back in January. The rest of the Bitcoin—$3 billion worth—is coming from the partners: Tether is contributing $1.5 billion, SoftBank is putting in $900 million, and Bitfinex is adding $600 million. 21 Capital also plans to raise an extra $350 million through a convertible bond, plus $200 million in a private equity round, to buy even more Bitcoin. Over time, the Bitcoin that SoftBank, Tether, and Bitfinex are putting in will be converted into shares of the company. The deal is expected to be announced in the next few weeks, but it’s still early and actual numbers could change.
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Chart 1: A High-Level Look Inside the $230 Billion Stablecoin Market
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Given this week’s theme in the
Digital Asset Digest, we thought it made sense to dive into the current state of the stablecoin market. Today, the stablecoin market
is $230 billion large. That’s nearly 30x growth over the past five years—and almost double in just the last year. There are now around 160 million stablecoin holders globally, transacting roughly $2.1 trillion in volume every month. The two biggest issuers, Tether and Circle, dominate the space: USDT and USDC together make up about 90% of the market. Ethereum hosts 56% of the stablecoin market, while Tron holds 30%. The rest is spread across various other networks. To date, stablecoins have processed over $60 trillion in lifetime volume across more than 4 billion transactions. With stablecoins becoming a key crypto priority for the new U.S. administration and traditional enterprises eyeing their own stablecoin launches, we expect this to remain one of the fastest-growing sectors in crypto for years to come.
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Chart 2: Saylor-Led Strategy Now Owns 2.5% of All Bitcoin—And The Buying Isn’t Slowing Down
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On Monday, the Michael Saylor-led Strategy
announced another major Bitcoin purchase—adding $559 million worth as part of its ongoing accumulation plan. Strategy now
owns around 535,000 BTC ($50 billion), which accounts for 2.5% of the total Bitcoin supply. In total, the company has spent $35 billion acquiring BTC at an average price of $66,631 per coin and is currently sitting on an unrealized profit of nearly $10 billion. Strategy is not only the largest corporate holder of Bitcoin but also one of the biggest holders globally, owning 11x more BTC than MARA Holdings (the second-largest public company by BTC holdings), 2.7x more than the U.S. government (6x more if you factor in BTC likely to be returned to Bitfinex), and 2.7x more than Fidelity’s Bitcoin ETF. Strategy began accumulating BTC in August 2020, when its market cap was under $2 billion. Since then, Bitcoin’s price has increased 6.9x, but Strategy’s market cap has skyrocketed 46x to $91 billion today, currently trading at a 1.83x multiple to its BTC holdings. And the buying isn’t stopping anytime soon. In October 2024, Strategy
unveiled its 21/21 plan, aiming to raise $42 billion over the next few years—split evenly between equity and fixed-income securities—solely to do one thing: stack more BTC.
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April 24, 2025
