Can Stablecoins Serve as a Building Block for a Petrodollar Successor?

Dollar-pegged stablecoins hold a significant amount of their reserves in short-term U.S. Treasuries. How quickly have USD stablecoin issuers grown as holders of U.S. debt? Looking back in time, how do they track relative to petrodollars? While stablecoin issuers have held a smaller share of U.S. debt in the last five years than oil exporters did after the petrodollar emerged, they are buying U.S. debt at a faster pace. 

• Challenge to the dollar-based monetary order: The dollar's standing as the world's reserve currency faces renewed pressure, as competing monetary arrangements—from China's renminbi internationalization to BRICS payment initiatives—seek to erode its primacy.
• Extending dollar dominance—lessons from history: The petrodollar system, initiated in 1974, addressed an earlier period of dollar vulnerability: Saudi Arabia began pricing oil primarily in dollars, recycling the proceeds into U.S. Treasuries and other dollar-denominated financial assets. Dollar denominated settlement of the oil trade expanded U.S. fiscal capacity and extended dollar dominance for decades.
• A successor to the petrodollar? Today, it is worth considering whether dollar-pegged stablecoins can serve as a building block for a petrodollar successor—one fitted for the AI age. As Girishankar (2025) has argued, dollar-pegged stablecoins could replicate this model if access to leading edge semiconductors—access to compute—were conditioned on settling AI-enabled goods and services in USD stablecoin. 

Navin Girishankar is president of the Economic Security and Technology Department at the Center for Strategic and International Studies in Washington, D.C. Andrea Leonard Palazzi is an associate fellow with the Economic Security and Technology Department. The authors would like to thank EST research intern Jacob Zimmerman for his data analysis support and Fabio Murgia, data visualization designer with the iDeas Lab, for the figures’ styling.