On November 30 last year, the Federal Register dropped a link, and the old hands in the industry groups went wild—eSLR was about to be loosened.

A lot of people might think, isn’t it just that the capital requirement for banks dropped by less than 1%? What’s the big deal? But those in the know understand this thing has been choking banks for a decade. Previously, when banks bought US Treasuries, it ate up their Tier 1 capital. Now, with these restrictions loosened, it’s basically giving them an “unlimited shopping license.”
Why does this matter to us? Because the fate of stablecoins is tightly bound to US Treasuries.
Whether it’s USDT or USDC, every dollar of stablecoin issued needs to be backed by a dollar of short-term Treasuries as reserves. Before, banks didn’t dare go all-in on Treasuries, so stablecoin issuers could only grow slowly. Now? Banks can buy freely, short-term Treasury yields are getting crushed to the floor, and the cost to issue stablecoins is almost zero.
The folks at Citi conservatively estimate that by 2030, the total stablecoin supply could reach $1.9 trillion. The more aggressive are calling for $4 trillion. Some crazier forecasts even go up to $8 trillion—sounds wild, but after the temporary SLR exemption in 2020, BTC shot up from over $4,000 to $69,000. There’s precedent for this kind of move.
Think about it: $306 billion in stablecoins was enough to fuel a major bull market. What would happen if $4 trillion flooded in?
Every on-chain game—DeFi yield farming, RWA tokenization, all those dog-themed meme coins, Layer 2 scaling—would go ballistic. Once liquidity explodes, leverage will go to the max, and the scene will be unimaginable.
The key thing is, this time it’s not just a temporary liquidity boost. After Trump took office, he made several big cuts: SAB 121, that annoying rule, was scrapped; the stablecoin compliance bill passed; now banks can openly issue and hold stablecoins. Wall Street’s old foxes have been setting up for this for a while:
Circle swapped all its reserves into 0-3 month Treasuries, buying as much as they could; BlackRock’s BUIDL fund sucked in $500 million in a month, and rumor has it JPMorgan is buying like crazy behind the scenes; Goldman’s trading desk even listed “stablecoin + short-term Treasury” as the most profitable trading strategy for 2026.
Last week, a friend told me his entire hedge fund team had gone all-in on 3-month Treasuries. He left me with this: “The day short-term Treasury yields drop below 3%, we’re going all in on crypto. This time it’s a permanent policy shift, not just a game.”
So, if you think the 2024-2025 cycle has already been crazy enough—this might just be the warm-up.
The real tsunami will be when trillions of dollars flood into the crypto market like a dam breaking. BTC at $200,000? ETH over $20,000? SOL hitting $1,000? These numbers sound wild now, but looking back, they might seem conservative.
Because this time it’s different. It’s not a bubble inflated by retail investors, but the US financial system itself cranking the tap to full and plugging the pipeline straight into the crypto world’s main artery.
Is your money ready? The real show might just be starting.
Which sector do you think will be the first to explode?