Viewpoint: Promoting the issuance of stablecoins may increase liquidity supply in the short term

Odaily Planet Daily News Huatai Securities Chief Macroeconomist Yi Yan analyzed that relaxing bank supervision and promoting the issuance of stablecoins may increase the demand for US debt and liquidity supply in the short term, and even smooth out the contradiction between the supply and demand of US debt to a certain extent. However, the short-term demand for "creating" US debt may amplify the long-term risks of US debt. In addition, the "Big and Beautiful" bill is expected to push up the US fiscal deficit by more than $4 trillion in the next decade, exceeding the previous House version. Deutsche Bank has previously pointed out that the bill may vigorously promote the US dollar stablecoin, increase domestic financial repression, put pressure on the Federal Reserve to cut interest rates and significantly weaken the US dollar. (Caixin.com)