U.S. Senator Bill Hagerty (R-TN) said stablecoin issuers could become the largest holders of U.S. Treasuries globally by the end of the decade, citing projections from Citibank.

What Happened: Speaking in an interview with CNBC on Monday, Hagerty emphasized the role stablecoins play in transforming the payments landscape while underscoring their backing by short-term U.S. government debt.

"This is a payment mechanism and not to be confused with Bitcoin or something that has a speculative component," Hagerty said. "By 2030, stablecoin issuers will be the largest holders of U.S. Treasuries in the world."

Hagerty stressed that unlike cryptocurrencies such as Bitcoin BTC/USD, stablecoins function as infrastructure for faster digital payments.

He dismissed concerns about risky asset backing, noting, "It's not going to be equities. It's going to be high-quality short-term assets, either short-term U.S. Treasuries or cash."

Why It Matters: The comments come as the U.S. Senate voted to advance the GENIUS Act, a stablecoin-focused bill that sets out the country's first comprehensive regulatory framework for fiat-pegged digital tokens.

The legislation cleared a 60-vote procedural hurdle on Monday, enabling the Senate to move toward final debate and voting.

Also Read: Jamie Dimon Opens JPMorgan To Bitcoin Access Despite Longstanding Criticism

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The GENIUS Act aims to provide guardrails for issuers like Tether USDT/USD and Circle USDC/USD, ensuring they hold reserves in secure assets like Treasuries.

The House of Representatives is working in parallel on its version of the bill.

Despite support from several Republicans and moderate Democrats, the legislation has faced resistance.

Earlier this month, Senate Democrats pulled back support during a previous procedural vote citing national security and anti-money laundering concerns.

Senator Elizabeth Warren (D-MA) remains opposed, warning that the bill could "turbocharge" corruption under a second Trump administration.

Still, Hagerty and others argue that regulatory clarity is critical for preserving the U.S. dollar's dominance in global finance, particularly as stablecoins gain international adoption.

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