Arthur Hayes: The US Dollar’s Next Weapon Isn’t Bonds, It’s Stablecoins

From Eurodollars to Stablecoins

Hayes framed the fight in historical terms, tying it to “Pax Americana,” the U.S.-led global order propped up by financial and military power.

He argued that the Treasury could exploit stablecoins to wrestle control back from the Eurodollar system—those vast pools of offshore dollar deposits that have long operated outside U.S. regulatory reach.

Hayes suggested that the U.S. could funnel global deposits into safe, yield-bearing assets like Treasury bills by promoting dollar-pegged tokens.

In his words, a stablecoin functions like a narrow bank: issuers take in dollars, invest them in T-bills, and mint tokens redeemable 1:1. That cycle not only reinforces demand for Treasuries but ensures that dollar flows return home.

“The only risk-free debt instruments in nominal dollar terms are Treasury debt securities.” Therefore, the more stablecoins that circulate, the more Treasury bill buyers there are, Hayes argued.

A Regulatory Tailwind

The timing, Hayes noted, is no accident. In July, U.S. lawmakers passed the GENIUS Act, creating the first comprehensive framework for stablecoin issuers.

The law has already unleashed a flood of applications from banks, fintech firms, and crypto companies eager to issue compliant tokens.

With regulatory clarity in place, stablecoins are quickly moving from speculative rails into mainstream settlement infrastructure.

Hayes argued that this is exactly what Bessent and the Treasury want: an influx of foreign retail deposits, especially from countries plagued by inflation and currency instability, flowing directly into the U.S. financial system.

Argentina as a Case Study

To make his case, Hayes pointed to Argentina, where the peso has lost 97% of its value against the dollar since 2018.

In such environments, he noted, locals increasingly bypass banks altogether and transact directly in USDT, a dollar-pegged stablecoin.

Paying service workers in crypto-stable dollars, Hayes said, reflects a growing global preference for dollar-based digital money over failing national currencies.

The implication is clear: if stablecoins become the default savings tool in the Global South, Washington gains a direct pipeline of capital that both undercuts de-dollarization efforts and deepens demand for Treasuries.

The Future of Pax Americana

For Hayes, the strategic use of stablecoins could mark the next evolution of American monetary power.

Where Eurodollars once slipped through Washington’s grasp, stablecoins—regulated, dollar-pegged, and Treasury-backed—could bring those flows home.

It’s a thesis that cuts against the grain of crypto’s anti-establishment ethos but highlights the paradox at the heart of digital finance: the same tools designed to decentralize money may end up reinforcing the world’s most centralized one.