🗽 Stablecoins and the American Techno-economic Conquest of the 21st Century

🏰 A New Empire Built on Stablecoins

In the 16th century, conquest rode the wind on sails of empire.

In the 19th, it thundered in on rails and rifles.

In the 20th, it flowed with oil and flew from distant airbases.

Now, on the 21st, it spreads silently as code, through the digital, crypto-native assets we know today as stablecoins.

Stablecoins, digital tokens pegged to fiat currencies, have outgrown their role as mere payment tools and evolved into instruments of power. 

Backed 1:1 by short-term U.S. Treasuries and powered by blockchain rails, these dollar-backed coins are frictionless, borderless, and increasingly everywhere, bridging crypto and traditional finance like no other asset can.

Their true purpose, however, lies deeper. They allow the United States to export its debt, reinforce dollar hegemony, and quietly colonize emerging markets.

It’s the most elegant form of financial imperialism in modern history. A techno-economic conquest so important that future generations will study for years to come.

What follows is the story of how America is weaponizing digital dollars, and the critical choices emerging economies must now make.

⛈️ The Coming Economic Storm

We're not diving into stablecoins just yet, first, you need to understand how we got there.

Storm clouds are gathering over the U.S. economy.

In April 2025, Donald Trump unveiled sweeping tariffs: 10% on most global imports, 25% on non-USMCA-compliant goods from Mexico and Canada, and a headline-grabbing 145% (dropped to 55%) on key Chinese products.

Branded as “Liberation Day” measures, these policies aim to protect domestic manufacturing. But protectionism has a price: inflation.

Tariffs are taxes in disguise. They push up the cost of imported goods, and those costs ripple across supply chains. From raw materials to electronics, American companies are passing the burden to buyers. 

The result is already visible. In May 2025, the U.S. Treasury collected $23B in tariffs, nearly 4x more than the same month last year.

As prices rise, households cut back and demand softens. That’s where the real danger lies, in a tariff-driven inflation shock triggering a recession. Sensing the risk, the Fed has pivoted.

Jerome Powell paused rate hikes and policymakers now project two rate cuts before year-end because growth is faltering.

What’s taking shape is a stagflation-lite environment: rising prices, weakening demand, and a central bank under political pressure to ease.

With fewer tools left at home, the U.S. will need to look outward to sustain its financial dominance.

I wonder how?

🏦 America’s Refinancing Problem

But take it easy, we're not at digital dollars yet.

While headlines focus on tariffs and inflation, another silent crisis is unfolding beneath the surface: the U.S. must refinance $9.2T of its debt in 2025 alone.

Yeah, you read that right. That’s nearly a quarter of all outstanding Treasuries, and most of it matures in the first half of the year.

As of June 2025, U.S. national debt has reached $37T, with roughly 80% held by the public.

Historically, U.S. investors have absorbed most of this debt, whether through 401(k)s or passive ETFs, a quiet, patriotic trade that’s been one of the worst-performing in modern history. Today, American holders sit on $19.7T in Treasuries, or 55% of all debt.

For decades, this system ran on habit: the Treasury issued new debt to pay off the old, set its own interest rate, and trusted the market to show up. The lower the rate, the cheaper the refinancing, but also the weaker the demand, as investors chased yield elsewhere.

China, Japan and Canada now hold just 6% of U.S. debt, down from 23% a decade ago. The Fed is off the table. The banks are pulling back. And the usual buyers are already walking away. 

To avoid default, the U.S. needs to sell trillions in bonds at the lowest yields in history, to buyers that no longer exist.

Unless, of course, it finds a new global distribution channel.

One that doesn’t look like a bond market at all.

🏇 Stablecoins as a Trojan Horse for Debt Export

One that looks like money. 

One that feels like innovation.

One that quietly refinances the American empire.

Stablecoins are the new, much needed, distribution channel. They're essentially an elegant way to repackage U.S. debt and export it. 

To the average user, a stablecoin is digital cash: fast, global, and pegged to the world’s most powerful currency. But each token minted is backed by short-term U.S. Treasuries, meaning every stablecoin circulating abroad quietly embeds a sliver of American debt into foreign economies. 

When someone in Buenos Aires or Bogotá buys USDC, they’re unknowingly buying into the U.S. bond market. They don't care, and they won't, because they'll trade the burden of their failing currency for stability any day of the week. And for the first time, it's just a few taps away.

It's simple, honestly, people just want dollars. The brilliance lies in the disguise, and the voluntary demand does the rest.

The model was just supercharged by the GENIUS Act. Signed into law in July 2025, it set clear rules for stablecoin issuers, and made U.S. Treasuries the default reserve asset, formalizing a pipeline that turns global dollar demand into fresh financing for America’s debt.

Trump hailed stablecoins as “internet money” that would cement U.S. power.

David Sacks called them a “strategic lever” to drive trillions into Treasuries.

Scott Bessent urged lawmakers to see them for what they are: a 21st-century tool to fund America’s deficits.

Private stablecoin issuers essentially become intermediaries funneling global savings into U.S. bonds, while providing users a digital dollar token in return. 

It’s a clean, high-tech mechanism for extending America’s economic reach, making stablecoins the Trojan horse carrying U.S. Treasuries into frontier markets.

So yeah, this is how they refinance the empire.

🛫 Infinite Dollar Demand Abroad

The genius of the stablecoin-as-debt-export strategy is that it taps into effectively infinite global demand for dollars.

Around the world, the U.S. dollar is king.

Long before crypto, the Eurodollar market (offshore dollar deposits in foreign banks) grew into a multi-trillion-dollar engine of dollar liquidity outside U.S. borders. Over $13T in U.S. dollar assets circulate abroad in these traditional channels because businesses and savers worldwide trust the dollar more than many local currencies.

Dollarization (whether formal or informal) is a recurring trend in any economy facing instability. What stablecoins do is open a new, direct channel for dollar access that is even more convenient and widespread. 

A smartphone and an internet connection is all you need.

In Argentina, triple-digit inflation has driven locals to swap pesos for USDC.

In Nigeria, years of currency devaluation and capital controls have made USDT the go-to unit of account for freelancers and merchants.

Given the choice, people in these countries will pick dollars over their local currencies every time.

The demand is limitless because holding dollars can literally be the difference between survival and financial ruin in unstable economies.

Stablecoins package that security in an even more liquid form, allowing dollars to flow like water through markets where traditional dollar access was once dammed by restrictions and banking friction.

🌐 The Current Reality

It’s easy to see how, if stablecoin adoption goes truly global, the demand for U.S. Treasuries could scale almost without limit, regardless of interest rate levels. 

Governments typically raise yields to attract buyers as debt supply grows. But if billions of people want digital dollars no matter what, then even low-yield Treasuries (held via stablecoin reserves) will find takers.

In essence, stablecoins could create an infinite bid for U.S. debt, because the demand is no longer just from traditional investors but from ordinary citizens around the world seeking dollar stability.

The thing is… it's not a matter of if or when. It's already underway.

As of mid-2025, stablecoin issuers collectively hold over $180B in short-term U.S. Treasuries. That’s about 0.5% of total U.S. debt, enough to rank them as the 17th-largest holder of Treasuries globally. 

In 2024, Tether was the 7th-largest buyer of U.S. Treasuries, out of everyone. A position typically held by entire nations, definitely not crypto companies.

As adoption grows, the purchasing power of stablecoin issuers scales exponentially. And projections from both Wall Street and Washington agree, like Orangie says, it's just getting started.

• The Treasury Department expects the stablecoin market cap to reach $2T by 2028.

• Standard Chartered forecasts a similar $2T mark by 2028.

• Citigroup projects a base case of $1.6T and a bull case of $3.7T by 2030, calling stablecoins crypto’s “ChatGPT moment.”

• Former Soros CIO and current Secretary of The Treasury Scott Bessent publicly endorsed Citi’s research.

Stablecoin supply stood at $205B at the start of 2025, that's a 10x jump in just 3 years. Hedge fund managers would laugh at you if you dreamed of those returns.

But were already at $265B, compounding at a pace that would make the forecasts plausible, with a triple-digit CAGR to match.

So when stablecoin are natively integrated into every app on your phone, the demand for Treasuries will become quasi-infinite, even with near-zero yields.

This is it. We're in the endgame now.

🦅 The MAGAfication of the World

The ultimate implication of these trends is the MAGAfication of the world’s financial systems: the spread of America-first monetary dominance through stablecoins.

Which is, in my eyes, a planetary-scale financial colonization.

We are essentially witnessing emerging markets’ fiat deposit bases become the next frontier of U.S. conquest.

In many developing countries, people will keep using local currency for small daily payments (if only out of habit or legal requirement), but their true store of value will shift to U.S. digital dollars, relegating the former to mere payment rails.

Instead of enforcing a colonial currency with an occupying army, the U.S. can induce foreign populations to willingly adopt its currency by offering a technologically superior and inflation-resistant option.

Because, why wouldn't they? It’s no coincidence that Tether and Circle are increasingly targeting regions like Latin America, Africa, and Southeast Asia.

The scale of this ambition is breathtaking, and honestly, I respect it. It's a bid to wire the world’s entire digital economy into the U.S. Treasury market. 

Considering that global M2 money supply is around $111T across all economies. If even a fraction of that moves into dollar-backed stablecoins, that’s trillions in new demand.

This is why the U.S. government finally warmed up to crypto after persecuting it for years, and why officials are celebrating each pro-crypto bill that gets passed. You don’t see this on the news, huh?

From their perspective, it’s a grand-slam: the dollar stays dominant and demand for its debt is secured, all under the banner of innovation and freedom (rather than overt coercion).

But of course, for countries on the receiving end, this is a double-edged sword.

On one hand, their citizens gain a stable store of value and a reliable medium of exchange. On the other hand, they’re subjugated to U.S. financial oversight while undermining the country's economic sovereignty.

Feels like one side is heavier.

By this I mean that the U.S. could one day freeze a rogue regime’s national stablecoin reserves at the contract level (like they do with hacks) while also orwellianly (I made up that word) supervising each and every transaction. 

And that this implies forfeiting total monetary control and letting go of the printers.

So everything you’ve read so far leads to one and one question only:

🌎 What Can Frontier Markets Do?

Emerging economies facing this stablecoin-driven dollar onslaught are left with a few strategic options, none of them perfect (well…).

And I’m sure developing world leaders are judging them as we speak:

1. Build a Wall

Aligning with our MAGA theme, this first option is basically to build a wall. To overregulate or ban USD stablecoins in order to protect monetary sovereignty.

Brazil, for instance, has already proposed restrictions on stablecoins payments and transfers to self-custody wallets while also building out their own CBDC, citing worrisome capital flight. And they're partly right, as 20% of the country’s capital outflows in 2024 were done via stablecoins, draining liquidity and creating infinite sell pressure on the real.

The goal here is to defend local currency by force of law. But stablecoins are internet-native, and tech always finds a way. Overregulation tends to be ineffective in the long run because users can just shift to VPNs, DEXs, and P2P networks. 

Nigeria banned crypto banking in 2021 and stablecoin usage went up anyway. 

Overregulation would just stifle innovation, alienate users, and drive activity into the shadows, reducing oversight without solving the core problem: people want stable money.

2. Join the Empire

Another path is the route Ecuador, Panama, and El Salvador have taken in the past: adopt the U.S. dollar as legal tender, abandoning local currency altogether. 

This is the most extreme form of embracing dollar hegemony, and it can indeed kill hyperinflation overnight. But it comes at a steep cost: loss of all monetary policy control.

The central bank is no longer relevant (it can’t print the Fed’s dollars), and the country becomes wholly dependent on U.S. monetary decisions.

It’s effectively putting your economy on the Federal Reserve’s autopilot. This might be acceptable for very small economies or those already heavily tied to the U.S., but for most emerging nations it’s a blow to national pride and flexibility.

A full embrace of the dollar is a last resort trade-off of sovereignty for stability, not something to be done lightly.

3. Take a Chance

The third and last option is to hedge against U.S. dominance and infinite local currency sell pressure by fostering an alternative store of value that isn't the dollar.

This could mean returning to gold, as we’ve seen with China and Russia accumulating reserves at record levels.

Or, my preferred choice, adopting a Bitcoin standard. 

Bitcoin offers what the dollar cannot: monetary independence, censorship resistance, and hard-coded scarcity. It's the first viable alternative monetary system native to the internet, open source and truly global. 

El Salvador led the way in 2021, declaring BTC legal tender in an effort to reclaim monetary sovereignty.

Digital gold they call it. And it might as well be our savior.

Take a hedge. How about you take a chance.

🗽 Endgame Economics

Ultimately, the fate of frontier markets may hinge on their ability to adapt to the dollar’s digital evolution. 

The United States has shown its hand: it intends to win the 21st-century techno-economic game by making the rest of the world use its currency and fund its debt. Stablecoins are the chosen instrument for achieving dollar hegemony through financial conquest.

Developing nations must either innovate and assert monetary independence, or be gradually absorbed into The Empire of the Dollar.

It's a brutally stark reality with no easy exits.

How this story unfolds will shape the global economic order and balance of power for decades to come.