"the caveat is that this could set the stage for a global financial crisis as a panelist on another discussion about interest rates noted that's because stable coins are backed by US Government debt this means that every time you buy a stable coin you're actually buying US Government debt behind the scenes logically the same is true in Reverse every time you sell a stable coin the the stable coin issuer needs to sell US government bonds now imagine a scenario where the stable coin Supply grows exponentially for whatever reason be it due to crypto payments or speculation since stable coins are used to buy altcoins if there was to be a massive crash in the crypto Market or some other issue there could be a rush of stable coin redemptions this would result in a massive sell-off of US government bonds which could theoretically push their prices lower and interest rates higher this could cause systemic issues in the Global Financial system similar to a banking crisis"
By Coin Bureau | February 4, 2025 | Pending
From video
Crypto at Davos: Why the Global Elite Are Worried 00:16:06 - 00:17:04
Interpreted Prediction
A massive sell-off of US government bonds due to stablecoin redemptions, potentially triggered by a crypto market crash, could cause a global financial crisis.

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