Is the US Planning a $37 Trillion Crypto Debt Reset?

Is the US Planning a $37 Trillion Crypto Debt Reset? - YouTube

Kremlin Advisor's Stablecoin Theory Meets Market Reality

BLUF (Bottom Line Up Front)

Anton Kobyakov, a senior economic adviser to Russian President Vladimir Putin, claims the United States plans to use dollar-backed stablecoins to devalue its $38 trillion national debt. While the recently enacted GENIUS Act does require stablecoin reserves to be held in US Treasuries, creating new demand for government debt, economists and financial experts dispute the notion that stablecoins could serve as a mechanism for deliberate debt devaluation. The claims mix factual elements about US debt dynamics and stablecoin regulation with unsubstantiated conspiracy theories about coordinated currency manipulation.

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WASHINGTON/LONDON — In September 2025, at the Eastern Economic Forum in Vladivostok, Anton Kobyakov, deputy chairman of the forum's organizing committee and long-time adviser to President Vladimir Putin, made waves with an audacious claim: the United States is engineering a scheme to place its massive national debt "into the crypto cloud," devalue it through stablecoins, and "start from scratch."

The assertion, widely amplified by Russian state media outlet RT, taps into genuine concerns about America's mounting fiscal challenges while advancing a theory unsupported by evidence of deliberate policy planning. An examination of the claims reveals a complex picture where regulatory reality, market dynamics, and geopolitical narrative intersect.

The Debt Reality

Kobyakov's characterization of US debt as unsustainable finds support in official data. As of early December 2025, total US federal debt stands at $38.4 trillion, according to the Joint Economic Committee of the US Congress. The debt has increased by $2.23 trillion over the past year, accumulating at an average rate of $6.12 billion per day.

More concerning for fiscal hawks: net interest payments reached $981 billion over the 12 months ending October 2025, nearly triple the $345 billion paid in October 2020. Interest costs now exceed spending on both Medicare and national defense, consuming approximately 14 percent of total federal outlays.

Foreign holdings of US Treasuries have indeed declined as a percentage of total debt. According to Ark Invest analysis, the share held by the largest foreign creditors has fallen from 23 percent to just over 6 percent over the past 13 years. China has reduced its Treasury holdings from over $1 trillion to $756 billion, while Japan, though remaining the largest foreign holder at $1.13 trillion, has also signaled

a more cautious approach.

The GENIUS Act: Real Policy, Disputed Purpose

The kernel of truth in Kobyakov's narrative centers on the Guiding and Establishing National Innovation for US Stablecoins Act of 2025—known as the GENIUS Act—signed into law by President Donald Trump on July 18, 2025.

The legislation, which passed with bipartisan support (68-30 in the Senate, 308-122 in the House), establishes the first comprehensive federal regulatory framework for dollar-denominated stablecoins. Crucially, it requires stablecoin issuers to maintain 1:1 reserve backing, with permitted reserves limited to US dollars, Federal Reserve notes, demand deposits at insured institutions, short-term Treasury bills (93 days or less), repurchase agreements backed by Treasuries, and money market funds invested in these assets.

Treasury Secretary Scott Bessent has been explicit about one intended benefit: "Stablecoins will expand dollar access for billions across the globe and lead to a surge in demand for US Treasuries, which back stablecoins," he wrote in August 2025.

The White House's fact sheet on the GENIUS Act states plainly: "By driving demand for US Treasuries, stablecoins will play a crucial role in ensuring the continued global dominance of the US dollar as the world's reserve currency."

Current Market Impact

The stablecoin sector's Treasury holdings are substantial but not yet transformative. As of late 2025, Tether—the largest stablecoin issuer—holds approximately $135 billion in US Treasuries, ranking it as the 17th largest holder globally, ahead of countries including South Korea, the United Arab Emirates, and Germany. Circle, the second-largest issuer, holds an estimated $55-65 billion.

Together, stablecoin issuers hold approximately $180-200 billion in Treasuries, making them collectively the 18th largest external holder, according to analysis from Apollo Global Management and TD Securities. This represents roughly 2.25 percent of the $6 trillion Treasury bill market and less than 1 percent of the total $28 trillion Treasury market.

However, projections suggest explosive growth. Citibank forecasts the stablecoin market could reach $2 trillion by 2028, up from approximately $250 billion in late 2025. Standard Chartered projects $2 trillion by the same timeframe, while Bernstein estimates $4 trillion by 2035. If these projections materialize and issuers maintain similar reserve compositions, stablecoin-related Treasury demand could indeed rival or exceed that of major sovereign holders.

The Historical Analogies: Accurate but Incomplete

Kobyakov drew parallels to two historical episodes of US currency policy—the 1933 gold confiscation and the 1971 Nixon Shock—as precedent for his stablecoin theory. These comparisons contain factual elements but lack the conspiratorial coordination he suggests.

The Roosevelt Gold Program (1933-1934)

On April 5, 1933, President Franklin D. Roosevelt signed Executive Order 6102, requiring Americans to surrender gold coins, bullion, and certificates to the Federal Reserve in exchange for $20.67 per troy ounce—the then-official gold price. Exceptions included up to $100 in gold coins per person and numismatic coins with special collector value.

The January 30, 1934, Gold Reserve Act subsequently revalued gold from $20.67 to $35 per ounce, effectively devaluing the dollar by approximately 69 percent against gold (not the "67 percent" cited in the video transcript, though the difference is minor). This action was taken openly to combat the Great Depression by expanding the money supply and breaking deflationary psychology.

The policy was controversial and faced legal challenges, but the Supreme Court ultimately upheld the government's authority in the Gold Clause Cases. Private gold ownership was not restored until December 31, 1974, when President Gerald Ford signed legislation repealing the restrictions.

The Nixon Shock (1971)

On August 15, 1971, President Richard Nixon announced the United States would no longer convert dollars to gold at the fixed rate of $35 per ounce, effectively ending the Bretton Woods system. This "closing of the gold window" was a unilateral decision made amid mounting pressure on US gold reserves and persistent balance of payments deficits.

The move did break the US government's commitment to foreign central banks holding dollars with the expectation of gold redemption. Since 1971, the dollar has indeed lost significant purchasing power relative to gold and many commodities, though measuring this as "96 percent" depends heavily on the baseline and measurement methodology chosen.

The Plaza Accord (1985)

The video transcript claims that in 1985, "the US and four other countries signed the Plaza Accords. They agreed to devalue the dollar by 25% over 2 years."

This characterization is partially accurate but oversimplified. On September 22, 1985, finance ministers and central bank governors from the G5 nations (United States, Japan, West Germany, France, and the United Kingdom) met at New York's Plaza Hotel and agreed to coordinate intervention in currency markets to depreciate the dollar, which had appreciated approximately 50 percent between 1980 and early 1985.

According to non-paper documents revealed later, the initial target was a 10-12 percent depreciation over the near term, not 25 percent over two years. However, the dollar's actual decline exceeded these targets: it fell approximately 25-26 percent within the first two years and ultimately declined about 40-50 percent against the yen and deutsche mark by 1987.

The Plaza Accord was an openly negotiated international agreement, not a covert manipulation scheme. It succeeded in reducing the US trade deficit and forestalling protectionist legislation in Congress.

The Devaluation Mechanism: Theory Versus Practice

Kobyakov's claim that stablecoins enable "distributed liability" that prevents coordinated exit by holders contains a logical element but overstates both the mechanism and intent.

Professor Yesha Yadav of Vanderbilt Law School, who studies the intersection of cryptocurrency and bond markets, told Fortune magazine: "Having stablecoin issuers always be there is a massive boost in terms of giving confidence to the Treasury [Department] about where to place debt."

However, she and other economists emphasize that stablecoins create demand for Treasuries primarily by attracting deposits that must be backed by these assets—not by enabling deliberate devaluation.

The Federal Reserve Bank of Kansas City published research in August 2025 noting that "stablecoins could increase Treasury demand, but only by reducing demand for other assets." The analysis points out that if stablecoin growth comes at the expense of bank deposits, and banks respond by selling Treasuries, the net effect on Treasury demand could be minimal.

MIT's Digital Currency Initiative warned in October 2025 that if stablecoins grow large enough, a run on major issuers could itself destabilize Treasury markets. Circle and Tether's combined $180 billion in Treasury bills represents about 20 percent of daily turnover in the entire US Treasury market. A forced liquidation could cause significant market disruption, similar to the March 2020 episode when Treasury markets seized amid pandemic-related selling pressure.

The Inflation Reality Check

The video transcript claims that from 2020 through 2025, the money supply grew from $15 trillion to $22 trillion, a "roughly 43% increase" that represented a "43% devaluation."

Federal Reserve data shows the M2 money supply peaked at approximately $21.7 trillion in March 2022 after rapid expansion during the pandemic, but subsequently declined to around $21 trillion by late 2023 before growing modestly again. The expansion was indeed dramatic, but the claim that this equals a direct 43 percent devaluation conflates money supply growth with purchasing power loss.

Actual inflation, as measured by the Consumer Price Index, rose approximately 20-23 percent cumulatively from 2020 to 2025, painful but not matching the 43 percent figure claimed. As of December 2025, CPI inflation had dropped to 2.74 percent year-over-year, the lowest since July, according to the Joint Economic Committee.

What Economists Actually Say

Barry Eichengreen, professor of economics at the University of California, Berkeley, expressed skepticism about the GENIUS Act's Treasury market implications: "If panicked customers force [stablecoin issuers] to sell [Treasuries backing stablecoins], Treasury prices could collapse, sharply increasing interest rates and destabilizing other financial markets and our entire economy."

The academic consensus suggests stablecoins create both opportunities and risks for Treasury markets, but few serious economists describe them as a deliberate debt devaluation mechanism.

Kim Hochfeld, State Street's global head of cash and digital assets, told Fortune: "There's a lot of hype, and the numbers are still tiny compared to what we see in normal TradFi. While I don't deny this is the start of a big trend, the numbers are still not enough to make us either super excited or super nervous."

International Response

Kobyakov's comments align with broader geopolitical concerns about dollar-denominated stablecoins. Chinese state media has called for yuan-backed digital currencies to be pursued "sooner rather than later." Zhou Xiaochuan, former governor of the People's Bank of China, warned that pursuing dollarization through stablecoins "could bring many adverse side effects."

European Central Bank President Christine Lagarde has expressed similar concerns, emphasizing that US dollar-denominated stablecoins threaten European monetary policy autonomy and pushing for development of a digital euro.

Notably, Russia itself has been developing ruble-backed stablecoins despite Kobyakov's criticism of US policy. In June 2025, Russian state media reported a new Russian stablecoin—A7A5—was in development and would launch on the Tron blockchain. Russia has used Tether's USDT to settle oil trades with China and India, suggesting the Kremlin's concerns about stablecoins are selective.

The Verdict: Fact and Fiction Intertwined

Accurate Claims:

• US debt is approximately $38 trillion and growing rapidly
• Interest payments now exceed defense and Medicare spending
• Foreign holdings of Treasuries have declined as a percentage
• The GENIUS Act requires stablecoin reserves to be held in Treasuries
• Tether and Circle are now among the largest Treasury holders globally
• Roosevelt did confiscate gold in 1933 and revalue it in 1934
• Nixon did end dollar-gold convertibility in 1971
• The Plaza Accord did coordinate dollar devaluation in 1985
• Stablecoins do create new demand for US government debt

Misleading or Unsubstantiated Claims:

• That there is a deliberate US government scheme to use stablecoins for debt devaluation
• That the Plaza Accord specified a 25 percent devaluation over two years (actual target was 10-12 percent initially)
• That 43 percent money supply growth equals 43 percent debt burden reduction
• That stablecoins enable a "distributed liability" trap preventing coordinated exit
• That this represents a covert reset mechanism rather than standard market dynamics

The Core Issue: The GENIUS Act does create new structural demand for Treasuries, which could help the US government finance deficits at lower rates. This is openly stated policy, not a hidden conspiracy. Whether this constitutes "manipulation" or prudent financial engineering depends largely on one's perspective and geopolitical alignment.

The more significant question is whether rapidly growing stablecoin Treasury holdings create systemic risks that regulators have not fully addressed—a concern raised by serious economists across the political spectrum, and one that has nothing to do with conspiratorial debt devaluation schemes.

As MIT's Digital Currency Initiative concluded: "Regulators and policymakers are going to have to face the question of whether stablecoin issuers will have access to the Fed Discount Window, and if not, what if any structural safeguards are needed to protect the US Treasury market."

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Verified Sources

1. Joint Economic Committee, US Congress. "National Debt Hits $38.40 Trillion, Increased $2.23 Trillion Year over Year." December 3, 2025. https://www.jec.senate.gov/public/index.cfm/republicans/2025/12/national-debt-hits-38-40-trillion-increased-2-23-trillion-year-over-year-6-12-billion-per-day

2. Congressional Research Service. "Federal Debt and the Debt Limit in 2025." September 2025. https://www.congress.gov/crs-product/IN12045

3. US Treasury Department. "Understanding the National Debt." Fiscal Data. https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/

4. Cointelegraph. "Putin advisor claims US is using stablecoins, gold to devalue its $37T debt." September 9, 2025. https://cointelegraph.com/news/us-is-using-stablecoins-devalue-debt-putin-advisor

5. The White House. "Fact Sheet: President Donald J. Trump Signs GENIUS Act into Law." July 18, 2025. https://www.whitehouse.gov/fact-sheets/2025/07/fact-sheet-president-donald-j-trump-signs-genius-act-into-law/

6. US Congress. "Text - S.1582 - 119th Congress (2025-2026): GENIUS Act." https://www.congress.gov/bill/119th-congress/senate-bill/1582/text

7. Latham & Watkins LLP. "The GENIUS Act of 2025: Stablecoin Legislation Adopted in the US." 2025. https://www.lw.com/en/insights/the-genius-act-of-2025-stablecoin-legislation-adopted-in-the-us

8. Fortune. "Stablecoin issuers like Circle and Tether are gobbling up more Treasuries than most countries." August 13, 2025. https://fortune.com/crypto/2025/08/09/circle-tether-stablecoins-treasuries-us-economy-impact-genius-act/

9. BeInCrypto. "Tether and Circle Just Overtook Nations as US Debt Financiers." August 9, 2025. https://beincrypto.com/tether-circle-us-debt-holdings/

10. MIT Digital Currency Initiative. "Will Stablecoins Impact the US Treasury Market?" October 16, 2025. https://www.dci.mit.edu/posts/stablecoins-treasuries

11. Federal Reserve Bank of Kansas City. "Stablecoins Could Increase Treasury Demand, but Only by Reducing Demand for Other Assets." Economic Bulletin, August 8, 2025. https://www.kansascityfed.org/research/economic-bulletin/stablecoins-could-increase-treasury-demand-but-only-by-reducing-demand-for-other-assets/

12. TD Securities. "The Impact of Stablecoins and Digital Assets in the U.S." October 28, 2025. https://www.tdsecurities.com/ca/en/stablecoins-digital-assets-in-us

13. Federal Reserve History. "Roosevelt's Gold Program." https://www.federalreservehistory.org/essays/roosevelts-gold-program

14. Wikipedia. "Executive Order 6102." Last modified December 2025. https://en.wikipedia.org/wiki/Executive_Order_6102

15. Wikipedia. "Gold Reserve Act." Last modified December 2025. https://en.wikipedia.org/wiki/Gold_Reserve_Act

16. Frankel, Jeffrey. "The Plaza Accord, 30 Years Later." NBER Working Paper No. 21813, December 2015. https://www.nber.org/system/files/working_papers/w21813/w21813.pdf

17. Wikipedia. "Plaza Accord." Last modified November 2025. https://en.wikipedia.org/wiki/Plaza_Accord

18. Baker Institute for Public Policy, Rice University. "The Plaza Agreement and Japan: Reflection on the Thirtieth Anniversary." Working Paper, September 2015. https://www.bakerinstitute.org/sites/default/files/2015-09/import/WorkingPaper-Plaza-Ito-092815.pdf

19. Atlantic Council. "Don't expect a Plaza Accord 2.0 to reverse the dollar's surge." July 21, 2025. https://www.atlanticcouncil.org/blogs/econographics/dont-expect-a-plaza-accord-2-0-to-reverse-the-dollars-surge/

20. World Economic Forum. "How will the GENIUS Act work in the US and impact the world?" July 2025. https://www.weforum.org/stories/2025/07/stablecoin-regulation-genius-act/

21. Committee for a Responsible Federal Budget. "Gross National Debt Reaches $38 Trillion." October 22, 2025. https://www.crfb.org/press-releases/gross-national-debt-reaches-38-trillion

22. PBS News. "U.S. hits $38 trillion in debt, after the fastest accumulation of $1 trillion outside of the pandemic." October 23, 2025. https://www.pbs.org/newshour/politics/u-s-hits-38-trillion-in-debt-after-the-fastest-accumulation-of-1-trillion-outside-of-the-pandemic

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Additional research from Bipartisan Policy Center, US Money Reserve, Stablecoin Insider, The Coin Republic, and Arnold & Porter Kaye Scholer LLP contributed to this analysis.