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REAL ESTATE MERCHANT BANKING
While much has been written recently about the Big Beautiful Bill and its impact on the real estate industry, far less has been said about the Genius Act—a major legislative development coming out of Washington, D.C. that could have significant effects on the capital markets and, by extension, the commercial real estate (CRE) sector.
Signed into law in July 2025, the Genius Act establishes a federal regulatory framework for payment stablecoins in the U.S. Stablecoins are digital currencies (think Bitcoin) backed by cash or “high-quality liquid assets,” such as U.S. Treasury securities. Unlike other digital assets regulated by the SEC and CFTC, stablecoins are classified as currency and are therefore exempt from securities and commodities laws.
With the Genius Act now in effect, the U.S. has effectively created a new and potentially massive buyer for Treasury Bills (T-Bills). Before I quantify the potential impact for short-term interest rates, a quick primer on U.S. government debt and how it is structured.
The Treasury Department issues debt in three primary forms:
• Treasury Bills (T-Bills): Short-term obligations (less than 1 year)
• Treasury Notes (T-Notes): Medium-term (2–10 years)
• Treasury Bonds (T-Bonds): Long-term (10+ years)
As of August 2025, the total public debt stood at $29.53 trillion, with T-Bills accounting for $6 trillion, or 20.3% of that total, according to the Joint Economic Committee Republicans.
Now, consider the potential impact of stablecoin growth on the T-Bill market. According to Circle Internet Group, there are currently $70.48 billion in U.S. stablecoins in circulation, with $260 billion globally. Barron’s in a recent article, projects this figure will reach $500 billion by 2026. Standard Chartered forecasts $2 trillion by 2028.
Assuming conservatively that 75% of stablecoin reserves are held in T-Bills (with the remainder in cash or gold), this would mean that by 2028, stablecoin issuers could hold approximately $1.5 trillion in T-Bills—equivalent to 25% of the current outstanding supply.
Unless the Treasury significantly increases T-Bill issuance, and assuming economic conditions remain stable, this surge in demand is likely to push yields lower. That, in turn, could reduce interest rates on CRE bridge loans and floating-rate term loans—potentially reshaping the financing landscape for commercial real estate.