In recent years, the U.S. economy has undergone transformations aimed at militarization, with stablecoins potentially becoming a primary funding tool for these changes.
Trump's Strategy and the Credit System
According to Arthur Hayes, Trump's current economic policy is heavily focused on expanding credit to support the military-industrial complex. He emphasizes that this is not occurring through traditional means but rather through stablecoins like Tether, which are actively investing in government bonds.
The Case of MP Materials
MP Materials secured a $1 billion loan from JPMorgan and Goldman Sachs to build a rare earth processing plant. This loan is backed by the government, ensuring banks receive stable returns, thus reducing risk for their investments.
The Role of Stablecoins in the New Economy
As credit flows increase, Hayes implies that expectations for crypto growth will be offset by rising demand for stablecoins. He predicts that if the cryptocurrency market capitalization reaches $100 trillion by 2028, $9 trillion will flow into stablecoins, driving demand for government debt.
Under the current economic policy of the U.S., stablecoins may occupy a unique position as a funding tool. This creates new challenges and opportunities for both the financial system and citizens.
