As China continues to promote the use of the yuan in international trade, former U.S. House Speaker Paul Ryan called on the U.S. government to use a dollar-backed stablecoin to counter the growing threat of China's rise.

He believes that the United States is facing a "foreseeable but avoidable debt crisis" and that stablecoins backed by the U.S. dollar are the "answer" to this crisis. Stablecoins can not only increase demand for U.S. Treasuries, thereby reducing the risk of debt default, but also help the dollar maintain its dominant position in the global financial system.

As the 54th Speaker of the House of Representatives from 2015 to 2019, Ryan is one of the most influential figures in American politics, with the power to shape the legislative agenda. He pointed out that the stablecoin market, currently worth $162 billion, has become a huge source of demand for U.S. Treasuries, which not only reduces the financing pressure of the U.S. government, but also helps maintain the important position of the U.S. dollar in the global financial system.

At the same time, stablecoins can provide "cheap and reliable financing" for fiscal spending on the blockchain, thereby helping the dollar maintain its "significant influence on the global financial system." In addition, stablecoins can increase demand for U.S. public debt, which is perfect for the United States.

Ryan said that China has been integrating the renminbi into digital infrastructure investment platforms in multiple emerging markets, which means that the renminbi is gradually replacing the dollar's dominance in international trade. The United States must find its own solution, otherwise it may be too late.

As the size of US debt continues to grow, policymakers need to consider adopting stablecoins backed by the US dollar to increase the international influence of US debt and avoid the risk of failed bond auctions, which will have a serious impact on the market and seriously damage the credibility of the United States. He believes that unlike the electronic renminbi launched by China, the US dollar-backed stablecoin based on a public, permissionless blockchain can embody the free and open values ​​of the United States. This may suggest that the United States may choose a decentralized stablecoin instead of a central bank digital currency (CBDC).

Ryan called on China and Saudi Arabia, which have been buyers of large amounts of U.S. debt in the past, to seek other payment methods other than settling in U.S. dollars. The United States cannot sit idly by and allow its largest international competitor to develop a safe and convenient digital currency. A stable currency backed by the U.S. dollar could bring demand for U.S. public debt and help the United States keep up with China.

It is worth noting that Ryan did not specifically recommend which stablecoins should be promoted, but called on Congress to develop a comprehensive regulatory framework. He believes that a strong stablecoin regulatory framework will help "significantly expand the use of digital dollars, which is critical to the United States." In fact, the framework has received bipartisan support in Congress.

Judging from the current situation, the United States is facing a serious debt crisis. In order to alleviate this crisis and maintain the dominance of the US dollar, the United States may eventually take measures to establish a stable currency backed by the US dollar. This will not only increase the demand for US Treasury bonds and reduce the risk of default, but also help the United States keep up with China's pace in the field of digital currency and maintain the influence of the US dollar in the global financial system.

However, this approach will also be criticized by some people who believe that it will continue to maintain and strengthen the existing financial system, rather than subvert and replace it like Bitcoin. In general, the United States' implementation of a stable currency policy is undoubtedly a double-edged sword. On the one hand, it can alleviate the debt crisis in the short term, but on the other hand, it may also aggravate the problems of the existing financial system. Further discussion and consideration by regulators and legislatures are needed in the future.

In summary, Paul Ryan's views reflect the concerns of American politicians about the development of China's digital currency and the urgent need to use stablecoins to protect the dominance of the US dollar. With the promotion of China's digital RMB, the United States may speed up the introduction of relevant regulations and vigorously develop its own digital dollar stablecoin in order to gain an advantage in this digital currency competition.