Circle CEO paints a disastrous scenario for the US dollar, warns Congress

Circle’s CEO has warned that the United States dollar’s place as the global reserve currency will be at risk if Congress does not act quickly to regulate stablecoins.

On July 13, Jeremy Allaire appeared in a two-minute video from USD Coin (USDC) issuer Circle, which was targeted at lawmakers.

It comes as bipartisan digital asset-specific legislation was reintroduced in Congress on July 12, originally introduced a year ago to June 2022.

“The strength of the dollar is at risk. There is increasing competition for what money is used for on the internet,” Allair claimed in the video, highlighting the threat of foreign digital currencies.

What does a cup of coffee have to do with the future of the global economic order? As the US Congress prepares for its first vote on stablecoin legislation, US political leaders have a choice to make regarding the competitiveness of the US Dollar. Below is a video for political leaders. $USDC pic.twitter.com/9sQyZwq4WE

— Jeremy Allaire (@jeralaire) 13 July 2023

“The real question is whether global trade will be in a digital dollar or a digital euro or a yuan,” he said. Allaire has previously claimed that China could boost the adoption and use of the yuan through stablecoins.

He said the US “has a choice” whether it wants “the dollar to be the basis of the currency on the Internet” or whether it will “let other countries take the lead?”

“If the dollar is to remain the world’s reserve currency, if America is to lead the world economy for the next 10 years and beyond, we need to build trust in digital dollars today and regulated stablecoins.”

In his argument for stablecoin regulation, Allaire claimed that crypto would “fundamentally change the way we pay for things.”

Connected European Banking Authority calls for early adoption of stablecoin standards

He added that “billions” of people would use crypto because of fees that would take “days” to make traditional financial payments and “tax nearly a trillion dollars on the global economy”.

Would you rather own: a stablecoin backed by US government securities that pays 5% interest or a deposit in a bank that looks like a hedge fund paying 2%? The answer is clear. I hope US lawmakers will support the development of well regulated stablecoins instead of fighting it.

— Mike Novogratz (@novogratz) 13 July 2023

Mike Novogratz, founder of crypto investment firm Galaxy Digital, seemed to agree with Allaire. He rhetorically asked his Twitter followers on July 13 whether they would rather own a stablecoin that pays higher interest than a “bank that looks like a hedge fund.”

The answer is clear,” Novogratz said. “I hope US lawmakers will support the development of well-regulated stablecoins instead of fighting it.”

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