A growing demand for US dollar-tied crypto stablecoins could help push down interest rates, according to US Federal Reserve Governor Stephen Miran. Speaking at the BCVC summit in New York on Friday, the Trump-appointed Miran stated that dollar-pegged crypto tokens could be “putting downward pressure” on the neutral rate, or r-star—the interest rate that neither stimulates nor impedes the economy. If the neutral rate drops, Miran explained, the central bank could respond by lowering its own interest rate.
Currently, the total market cap of all stablecoins stands at $310.7 million, based on CoinGecko data. Miran highlighted that Federal Reserve research suggests the stablecoin market could swell to as much as $3 trillion in the next five years.
“My thesis is that stablecoins are already increasing demand for U.S. Treasury bills and other dollar-denominated liquid assets by purchasers outside the United States, and that this demand will continue growing,” said Miran. “Stablecoins may become a multitrillion-dollar elephant in the room for central bankers.”
Organizations including the International Monetary Fund have warned that stablecoins could threaten traditional financial assets and services by competing for their customer base. Similarly, U.S. banking groups have urged Congress to enforce stricter oversight of stablecoins—especially those offering yield—arguing that they could attract would-be bank customers.
**Regulation to Pave the Way**
During his speech, Miran praised the GENIUS Act for establishing clear guidelines and consumer protections, suggesting that an updated regulatory framework will be pivotal in driving broader adoption of stablecoins.
“While I tend to view new regulations skeptically, I’m greatly encouraged by the GENIUS Act. This regulatory apparatus for stablecoins establishes a level of legitimacy and accountability congruent with holding traditional dollar assets,” he said. He added, “For the purposes of monetary policy, the most important aspect of the GENIUS Act is that it requires U.S.-domiciled issuers to maintain reserves backed on at least a one-to-one basis in safe and liquid U.S. dollar-denominated assets.”
As stablecoins continue to grow—and as lawmakers debate their oversight—they may rapidly become a central topic for both regulators and financial markets alike.
https://bitcoinethereumnews.com/tech/feds-miran-says-stablecoins-may-help-lower-interest-rates/