An analyst has cautioned that passing the Digital Asset Market Clarity Act will not provide enough stablecoin-based demand to resolve upcoming challenges in the U.S. Treasury debt market.
While some supporters of Treasury Secretary Scott Bessent view the CLARITY Act as a key tool to stabilize the U.S. debt market, critics argue this perspective misunderstands the scale of the financial shortfall. Lawrence Lepard, investment manager and author of “The Big Print,” stated on social media that the notion of stablecoins saving the Treasury market is unproven.
Lepard pointed out that the current stablecoin market capitalization stands at $255 billion, having declined from a peak of $263 billion in January. Because stablecoins are largely backed by U.S. Treasuries purchased by issuers like Tether and Circle, Lepard calculated that this market capitalization covers barely 3% of the more than $8 trillion in debt the U.S. Treasury needs to roll over each year.
Additional pressure stems from declining international participation. Foreign holdings of U.S. debt have decreased from 57% following the financial crisis to 32% in 2025, creating a pressing need for new sources of liquidity to maintain healthy demand for debt instruments.
Although analysts generally agree that regulatory clarity would increase demand for payment stablecoins, Lepard's assessment suggests that expecting this growth to fully offset national debt demand is unrealistic without massive expansion. Conversely, advocates like Coinbase Chief Policy Officer Faryar Shirzad maintain that dollar stablecoins are necessary to convert growing overseas digital dollar demand into demand for U.S. Treasuries across the yield curve.
