Stablecoins Could Lift Demand for US Treasuries

A Bank of England official believes that dollar-linked digital tokens could increase demand for US Treasury securities. Carolyn Wilkins, an external member of the Financial Policy Committee, made this remark in a speech at Queen's University Belfast on September 15, 2026.

The privately issued tokens designed to hold a one-to-one value with the dollar account for nearly all of the market's outstanding stablecoin value, which is approximately 98 percent tied to the US currency. This gives it a significant advantage as these instruments move beyond crypto trading into wider payment and settlement uses.

Issuers typically place the funds they receive into highly liquid reserve assets such as short-term US Treasury securities, cash, and Treasury-backed repurchase agreements. As a result, growth in token supply can channel additional buying into the market for US government paper.

Wilkins cited Bank for International Settlements research showing that the two largest dollar tokens, USDT and USDC, together held nearly $150 billion in Treasury bills at the end of 2025 and acquired about $33 billion of those securities during the year.