Key Takeaways:
- A Kremlin advisor claims the US will “reset” its $37T debt by transferring it into stablecoins, an concept specialists say is neither authorized nor technically possible.
- Analysts say stablecoins might broaden US monetary attain, however they can not erase present obligations with out triggering default.
- The warning exhibits Russia’s deeper concern: America’s rising affect in crypto finance and the opening of a brand new entrance within the US-Russia “coin wars.”
U.S. President Donald Trump’s marketing campaign promise to pay America’s $37 trillion debt in Bitcoin was mocked by each supporters and critics as political theater. However in Russia, a robust rival, the rhetoric has elicited severe warnings.
Anton Kobyakov, a senior advisor to Russian President Vladimir Putin, just lately accused the U.S. of positioning itself as arbiter over crypto and gold markets to deal with declining belief within the greenback. He says Washington will use this affect to devalue its debt by transferring it into stablecoins.
“Simply take into consideration their debt – $35 trillion,” Kobyakov informed contributors on the Jap Financial Discussion board in Vladivostok earlier this month. The U.S. will reset its debt on the world’s expense by “driving everybody into the cryptocurrency cloud.”
America’s debt has since ballooned to $37 trillion. Trump beforehand introduced plans for a Strategic Bitcoin Reserve, intending to make use of income from the reserve to repay federal debt.
Nonetheless, Putin’s advisor stated the reset can be by way of stablecoins – a sort of cryptocurrency that’s tied to a fiat foreign money just like the greenback for stability.
“Over time, when a part of the US authorities debt is positioned in stablecoins, the US will devalue this debt. In different phrases, they’ve a $35 trillion debt, they drive it into the cryptocurrency cloud, devalue it and begin from scratch,” Kobyakov stated.
The Kremlin strategist didn’t present particulars on how migrating the debt to stablecoins would result in devaluation.
Russia simply stated the quiet a part of the USA plan for Stablecoins and Bitcoin OUT LOUD for the world.
AND realised they’ll't do a single factor about it.
Subsequent step is the race to build up first – and never be victimized by it. pic.twitter.com/3PwNPGH096— BRITISH HODL
(@BritishHodl) September 8, 2025
Stablecoins Can’t ‘Magically’ Wipe Away US Debt
Chopping by way of conspiracy and hyperbole, crypto analysts say transferring U.S. debt into stablecoins will not be technically possible.
“Migrating even a fraction of $37 trillion of U.S. debt onto stablecoin rails isn’t only a change you flip,” Kony Kwong, CEO of GAIB, an organization that’s constructing the financial layer for synthetic intelligence on-chain, informed Cryptonews.
He stated the thought of utilizing stablecoins to “magically devalue” U.S. debt is unrealistic.
“Treasuries are authorized contracts, and you’ll’t simply re-label obligations with out triggering default or express coverage strikes.”
Whereas new issuance could be slowly and incrementally tokenized, says Kony, utilizing stablecoins to shortchange world collectors would transcend the boundaries of what’s legally doable.
Symbiotic chief working officer Jill Friedman, who can also be a lawyer, stated the proliferation of stablecoins reminiscent of Tether’s USDT and Circle’s USDC is prone to improve world entry to U.S. {dollars}.
However merely manipulating stablecoins to erase America’s debt is exterior federal remit, she says. Kobyakov’s declare could also be Russia’s compensatory grasp for Trump’s weaker factors in a delicate battle that has largely favored the latter.
To start out with, the united statesgovernment doesn’t personal stablecoins.
“It’s vital to do not forget that U.S. greenback stablecoins usually are not issued by the federal government or central financial institution however by personal entities and monetary establishments,” Friedman tells Cryptonews. “The most important USD stablecoin is Tether, which isn’t based mostly within the U.S. and has a market cap of $172 billion.”
America does have an choice to create its personal sovereign stablecoin. As Kony explains:
“If the U.S. launched a sovereign, Treasury-backed greenback token, it could doubtless turn into the default inside regulated pipes (i.e., banks, fintechs, and compliant exchanges). It is because counterparty and coverage threat drop, squeezing personal issuers on yield seize and onshore market share.”
A federal stablecoin wouldn’t section out USDT and USDC. “They’d proceed to serve permissionless, cross-border liquidity and sooner multi-chain distribution, the place a federal coin strikes extra slowly,” he added.
“We’d see extra on-chain demand for T-bills (good for U.S. funding), tighter margins for personal stablecoins within the U.S., and a break up market: regulated {dollars} for regulated rails, personal {dollars} for the sides.”
Coin Wars
The Kremlin’s novel declare will not be technically exact, nevertheless it reveals discomfort with America’s rising affect in crypto and the stablecoin market underneath the self-proclaimed “Crypto President” Donald Trump.
Russia worries about what may occur if the U.S. acquires an influential stake in a serious token, reminiscent of USDT or USDC, to pump or devalue it in its personal pursuits, in response to analysts.
Kobyakov’s declare additionally brings Russia and America’s covert “coin wars” into the open. Whereas the U.S. is a transparent tech hegemon, Russia will not be a pushover.
Russia’s socialist roots might have helped it spawn open-source apostles reminiscent of Ethereum founder Vitalik Buterin and TON founder Pavel Durov. Its place as a comparable world superpower has additionally supplied a haven for cypherpunks – like Edward Snowden – hounded by the U.S.
However a centrist tradition, even a jail-and-recruit scheme, that locations disruptive tech expertise underneath the wings of presidency has naturally led to a mind drain. Russia is now pursuing a digital different to greenback dominance through the BRICS+ platform.
Trump’s Wager On Bitcoin
Paying down federal debt in crypto is a traditional wager of the Trump Group. Relatively than arbitrarily migrate the nationwide debt to stablecoins, President Trump has floated the thought of stacking up Bitcoin within the authorities reserve.
The plan has been variously “debunked” by crypto analysts. Ben Ritz, vp of coverage improvement for the assume tank Progressive Coverage Institute, says the whole market cap of BTC is nowhere close to the U.S.’s $37 trillion debt.
“If all of the Bitcoin on this planet isn’t price sufficient to cowl a single yr’s price range deficit, there isn’t a means shopping for 5% of it could actually plausibly stem the expansion of, not to mention repay, our nationwide debt,” Ritz stated in a Forbes op-ed.
It’s nonetheless doable {that a} reserve foreign money held for 20 years may improve in worth. However aggressive shopping for would trigger value distortion, volatility, and probably convey down the BTC value, he stated. Perceived authorities takeover, even when restricted to five%, would additionally “rewrite” the principles of other finance.
The submit $37T Query: Can Stablecoins Be a Magic Bullet for US Debt? appeared first on Cryptonews.