Treasury Secretary Bessent Defends Dollar Dominance With Stablecoin and FX Data

Bessent pushes back on economic pessimism

Treasury Secretary Scott Bessent has defended the strength of the U.S. economy, pointing to the dollar's global role and stablecoin adoption. Stablecoins are digital tokens usually tied to the value of a traditional currency like the U.S. dollar.

His comments come as the 10-year Treasury yield reached 5%, a multiyear high, and after a New York Times report outlined structural risks in the country's financial position.

Key points Bessent made

• The dollar is on one side of 89.2% of all foreign-exchange transactions.
• The vast majority of stablecoins are pegged to the U.S. dollar.
• Record median household income, a historically low poverty rate, continued employment growth, and a 5.1% annualized estimate for third-quarter GDP from the Atlanta Fed support the economy.
• Treasury bond buybacks aim to improve liquidity and manage debt maturities, not suppress yields.
• Saudi Arabia's exit from the mBridge digital currency platform is seen as a win for dollar dominance.

What Bessent said about bond buybacks

The Treasury has been repurchasing longer-term bonds, which critics say is an attempt to lower yields. Bessent rejects that view, saying the buybacks are about improving market liquidity and managing the maturity structure of a Treasury market worth more than $30 trillion.

Saudi Arabia's mBridge exit

Bessent cited Saudi Arabia's departure from mBridge, a China-backed cross-border digital currency platform, as evidence of dollar strength. However, Saudi Arabia said it left after completing a planned proof of concept in May 2025. The platform continues to expand elsewhere, so the move is seen as a symbolic win rather than a sign the project is failing.

What is confirmed

Bessent posted his defense on X, citing the 89.2% figure for the dollar's share in FX trades and the prevalence of dollar-pegged stablecoins. He also highlighted the economic data points mentioned above. The 10-year yield reached 5%.

What is still unclear

It is not clear how much impact bond buybacks have had on yields. Critics and Bessent disagree on the purpose of the program.

Why this matters

These statements come amid concerns about high government debt yields and changes in international payment systems. Stablecoins, which are mostly tied to the dollar, could play a role in keeping the dollar dominant in global finance.

Sources

• CoinDesk