Standard Chartered Sees $1T T-Bill Demand from Stablecoins

Key Insights:

• Stablecoins could generate up to $1T in new T-bill demand by 2028.
• Market cap projected to hit $2T, boosting short-term Treasury buying.
• Treasury may pivot to bills, potentially pausing 30-year bond sales.

Standard Chartered analysts currently estimate a significant liquidity shift worldwide. Stablecoins could drive $1 trillion in T-bill demand by 2028. This is a run of projections for the total market capitalization of digital assets, which amounts to $2 trillion.

According to analysts led by John Davies, Standard Chartered’s U.S. rates strategist, and Geoffrey Kendrick, the bank’s global director of digital assets research, stablecoin market capitalisation is still expected to reach $2 trillion by the end of 2028. Stablecoin Growth can only rise speedily with the US Treasury’s appetite.

Scaling the T-Bill Demand of $1 Trillion.

According to current data, stablecoins already have high short-term debt. Tether and Circle today handle billions of liquid reserves. Standard Chartered anticipates this to soar exponentially.

The bank believes that the market cap of the stablecoins will be doubled in four years. This type of growth needs liquid assets of high quality to support it. As a result, issuers will have to seek stability in pegging them to US Treasuries.

The result of this institutional change is to provide the government with an enormous sink of debt. It successfully turns the crypto protocols into key creditors to the United States. Analysts are optimistic that this will put a stop to the wider digital asset system.

T-Bill Demand and Price Dynamics.

Yield curves now represent a complicated macroeconomic environment. Digital asset managers are still attracted to short-term Treasury yields. High interest rates encourage issuers to issue additional bills.

The difference between yields and the cost of operations benefits the stablecoin providers. Demand pressures on the short-term rates generally occur downwards due to increased T-bill demand. This negative correlation makes bond prices highly volatile.

Stablecoin Market Cap | Source: DefiLlama

Stablecoin supply is currently about $300 billion. It has slowed in recent months due to a drop in crypto asset values and a slower deployment of new regulated goods following the July 2025 approval of the GENIUS Act. That halt is seen by the bank as cyclical rather than structural.

Treasury Strategic Pivots

The US Treasury is likely to change its issuance approach. Standard Chartered notes a possible shift towards shorter-dated paper. High demand means the Treasury can focus on bills rather than bonds.

Combined with stablecoin growth, total new bill demand might reach $2.2 trillion by 2028. According to Congressional Budget Office estimates, if the proportion of bills in total outstanding debt stays the same, that amounts to roughly $1.3 trillion in expected net T-bill supply during the same time period. The bank claims that if Treasury doesn’t modify issuance, there may be a $0.9 trillion shortage.

Currently, T-bills make up 21.7% of outstanding marketable debt. That’s lower than the post-World War II average of 26.1% but more than the Treasury Borrowing Advisory Committee’s suggested 15% to 20% range.

According to Standard Chartered, increasing that share by only 2.5 percentage points over three years would result in an additional $0.9 trillion in bill issuance. It would compensate for the anticipated supply shortage.

Reducing the issuing of long-dated notes and bonds is one approach to do this. According to Kendrick and Davies, moving $0.9 trillion from long-end supply into bills could effectively halt 30-year bond auctions for 3 years, given current auction sizes.

In contrast to today’s 5% to 6% deficit levels, the U.S. Treasury previously suspended 30-year issuance between 2002 and 2006. However, that decision was made during budget surpluses.

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