If US treasury crashes, so will stablecoins. It will make 2008 subprime mortgage that let to world financial crisis a child play. US is getting desperate for its US$ hegemony now risking everything to save itself 如果美國國債崩潰，穩定幣也會如此。這將使2008年導致世界金融危機的次貸危機如同兒戲。美國正渴望美元霸權，現在不惜一切代價自救, 其未日將至.

Potential impact of US Treasury clashes on stablecoins

The relationship between the US Treasury market and stablecoins is evolving and could be significantly impacted by potential clashes or instability within the Treasury market.
Here’s how a US Treasury clash could affect stablecoins:

1. Reduced confidence and potential de-pegging
   • Stablecoins, especially those backed by US Treasuries, derive their stability and value from the perceived safety and reliability of those assets.
   • A clash or uncertainty in the Treasury market could undermine confidence in these assets, leading users to question the stability of the stablecoins and potentially triggering a rush to redeem them.
   • If a stablecoin issuer is unable to meet redemption demands due to illiquid Treasury reserves or widespread panic, the stablecoin could lose its peg to the underlying fiat currency (e.g., the US dollar), causing its value to fluctuate dramatically.
2. Liquidity challenges for stablecoin issuers
   • Stablecoin issuers rely on being able to readily access and liquidate their Treasury reserves to honor redemption requests.
   • Disruptions or heightened volatility in the Treasury market could hinder an issuer’s ability to convert their Treasury holdings into cash, creating liquidity challenges and potentially delays in redemption processing.
3. Broader financial market impacts
   • A large-scale redemption scenario in the stablecoin market could force issuers to sell off significant amounts of Treasuries, potentially impacting Treasury prices and disrupting fixed-income markets.
   • According to Cristiano Ventricelli, Vice President and Senior Analyst of digital assets at Moody’s Ratings, problems in the stablecoin sector could spill over into broader financial markets, affecting institutions holding similar assets or those reliant on stablecoin liquidity.
   • This creates a potential “doom loop” where crises in one market can rapidly trigger crises in the other due to their interconnectedness, according to Medium (https://medium.com/@pareto_investor/genius-act-debt-war-crypto-f06a3f785db1).
4. Operational and reputational risks
   • Stablecoin issuers rely heavily on the reputation and stability of US Treasuries to maintain user trust.
   • A Treasury clash or threat of default could damage that reputation, forcing issuers to implement increased transparency measures and communication strategies to reassure users.
   In essence, while the growing ties between the stablecoin market and the US Treasury market present opportunities for both to mutually benefit through increased demand for Treasuries and enhanced dollar liquidity, they also amplify the potential for risks to spill over from one market to the other in times of instability. Therefore, maintaining a healthy and stable Treasury market is crucial for the continued success and growth of stablecoins and, conversely, sound risk management and regulatory clarity within the stablecoin market are vital to protect against potential spillover effects to the broader financial system.