Stable(coin) Genius

Circle, Tether, and Trump’s plot to run a sovereign wealth fund for himself, with your dollar as the collateral.

Once upon a time, money was simple. You held a piece of paper with some dead president’s face on it, and that rectangle meant you could buy groceries, pay your rent, or bribe a politician, depending on your taste in civic engagement. The system was clunky, but it worked because of one quaint, old-fashioned idea: people trusted the U.S. government to stand behind that piece of paper. Fast forward to the twenty-first century, and that paper is less about wood pulp and more about lines of code zipping between bank ledgers. We swipe, tap, Venmo, or PayPal, and the money doesn’t so much exist as it occurs. The whole system still hinges on trust in the United States, trust that when you transfer a dollar, it actually represents a dollar.

Enter the latest disruptor: the stablecoin. Forget the “to the moon” meme coins and the Doge-branded circus acts. A stablecoin is the more respectable cousin, a digital token tethered (pardon the pun) to the value of the U.S. dollar. The promise is seductive: you take the speed and efficiency of crypto and marry it to the reliability of the greenback. No middlemen skimming fees, no three-day settlement wait, just instant transactions anywhere in the world. Every stablecoin is supposed to be backed one-to-one by a real U.S. dollar sitting quietly in reserve, usually in the form of Treasury bills. It’s the financial equivalent of a calorie-free dessert, sweet without consequences, at least on the surface.

Max at UNFTR breaks this all down and hammers home this twist: if you control a stablecoin at scale, you’re not just running a tech startup. You’re playing central banker. You mint digital tokens out of thin air, collect fees when they circulate, and, most lucratively, you park the reserves in U.S. Treasuries and pocket the interest. That’s seigniorage, central banks’ age-old trick of making money from creating money. Only now, in this brave new world, it’s privatized. Instead of interest flowing back into the public treasury, it lines the pockets of whoever controls the coin. When it’s Circle or Tether, that’s eyebrow-raising. When it’s Donald J. Trump, the sitting President of the United States, it’s hair-on-fire territory.

Circle and Tether sound like harmless names, a yoga class and a kid’s jump rope, maybe, but in reality they’re the two biggest money-printing machines you’ve never heard of. Both are private companies that run stablecoins, those digital stand-ins for dollars.

Tether, the heavyweight, issues a token called USDT. Every time a trader mints one, they’re supposed to deposit a real dollar (or its equivalent) in Tether’s coffers. Circle runs USDC, which works the same way but has spent a lot more time trying to look respectable, courting regulators and Wall Street bankers. Together, the two are sitting on more than a hundred billion dollars’ worth of reserves, mostly U.S. Treasury bills. That makes them bigger bondholders than many countries.

And here’s the punchline: the interest from those Treasuries doesn’t go back to taxpayers. It flows straight into the pockets of Circle and Tether. So while you’re paying higher rates on a car loan or mortgage, these guys are clipping coupons off the same debt that’s strangling you. They don’t run banks, they don’t answer to voters, but they have their hands deep in the bloodstream of the dollar.

So when Max raises alarms about Trump’s own wannabe stablecoin, USD1, he’s pointing to a system that already exists. Circle and Tether have proven the model. They’ve shown that there’s big money to be made by playing central banker without being one. Trump’s innovation, if you can call it that, is cutting out the pretense of separation between the guy printing the money and the guy pocketing the profits. He’s decided to be both.

Max’s reporting paints the picture vividly: World Liberty Financial, the Trump family’s crypto Frankenstein, already issues a stablecoin called USD1. Compared to giants like Tether and Circle, it’s a rounding error in volume, but here’s the catch: Trump isn’t just a market participant. He is the regulator, the policymaker, the referee, and the head cheerleader all at once. Thanks to the GENIUS Act, the Treasury Department, not the independent Fed, oversees stablecoins, which means Donald Trump, the man who once tried to pay off his porn-star hush money through a fixer, is now the gatekeeper for who gets to issue digital dollars. Add in pending bills that would neuter the SEC and block the Fed from launching its own digital coin, and you have the makings of a system where private issuers, not the United States government, own the digital future of the dollar. And wouldn’t you know it, Trump just happens to own forty percent of one of those issuers.

Now, about that old chestnut: Trump’s dream of a sovereign wealth fund. Back in his first term, he fantasized about creating a U.S. version of Norway’s oil fund, a national nest egg that would invest America’s riches for the common good. On its face, it was a populist flourish, a promise to turn Uncle Sam into Warren Buffett. In practice, it was about as believable as Trump University’s “MBA” program. But now, through the backdoor of stablecoin, he’s stumbled onto something darker: a privatized sovereign wealth fund, one where the “sovereign” is not the American people, but the Trump family trust.

Think of it this way. A true sovereign wealth fund takes national surpluses, tax revenue, oil royalties, trade windfalls—and invests them so that the nation benefits. Trump’s version channels the revenue from dollar creation and Treasury interest into his own family’s balance sheet. The public wealth doesn’t compound for hospitals, schools, or climate resilience; it compounds for Mar-a-Lago renovations and Eric Trump’s next hair transplant. Instead of stabilizing the economy, it destabilizes it, because here’s the diabolical incentive: the more chaotic the economy, the more Treasuries are issued, the higher the yields, and the fatter the Trump family’s returns. Ordinary Americans suffer under inflation and higher borrowing costs, while Trump’s stake in World Liberty Financial mushrooms from billions into tens of billions. It’s a sovereign wealth fund in reverse, socialism for the family, austerity for everyone else.

The ominous part isn’t just the grift, though that’s nauseating enough. It’s the alignment of political and financial incentives. Trump thrives politically on crisis, on manufacturing chaos to justify more power. Now he also thrives financially on crisis, because every notch of instability in the bond market sweetens his personal cut. A weaker America is a richer Trump. That’s not just kleptocracy; that’s a structural betrayal of the republic.

Max is right: this is a potential financial scandal of historic proportions, and it’s unfolding in real time while most of the media are too busy parsing Trump’s latest word salad or golf cheat. The story isn’t just that Trump is corrupt, we’ve all read that children’s book. The story is that he may have found a way to privatize the very machinery of the dollar itself, to convert the global reserve currency into a family ATM. If a sovereign wealth fund is supposed to secure the nation’s future, Trump’s version secures his family’s fortune and leaves the rest of us holding the bag.

And that, dear reader, is the punchline of the Stable(coin) Genius: Donald Trump doesn’t need to sell you a steak, a diploma, or a hat anymore. He’s figured out how to sell the dollar itself, and somehow, we’re the ones paying him for the privilege.