Stablecoin issuers have replaced 40% of China’s lost US Treasury demand

- Stablecoin issuers have quietly replaced 40% of China’s lost Treasury demand. Tether and Circle bought $200B in short-term debt while Beijing sold long-term notes. The Fed admits this shifts the investor base, making US financing more sensitive to retail yield chasers rather than central banks. It’s aggressive passive income funded by meat wallets chasing dollar stability abroad. This isn’t a bull run; it’s a maturity mismatch waiting for a rate hike to bite. The GENIUS Act locks them into bills, so they can’t save the long end. We are trading sovereign creditors for algorithmic liquidity. Enjoy the volatility when the relay window closes.