Billionaire investor Stanley Druckenmiller has suggested that the U.S. dollar's status as the world's reserve currency could weaken over the long term, with digital assets such as bitcoin and stablecoins potentially taking its place.
In a recent interview hosted by Morgan Stanley, Druckenmiller said, "The dollar will probably outlive me, but I question whether it will still be the reserve currency in 50 years," according to Forbes on Thursday (local time).
Rising U.S. debt is behind his forecast. Federal government debt has surpassed $38 trillion, reaching an all-time high. Massive fiscal spending since the COVID-19 pandemic, combined with rising interest rates, has rapidly increased the interest burden.
Druckenmiller sees digital assets as a potential alternative. "I don't know what will replace the dollar as the world's reserve currency, but it could be some cryptocurrency that I dislike," he said, adding that "bitcoin is competing with gold as a traditional safe-haven asset and growing its presence in the market."
He particularly praised stablecoins' potential. "Stablecoins are faster, more efficient, and cheaper than existing payment systems," he said. "Within 10 to 15 years, a significant portion of payment systems will shift to stablecoin-based platforms."
Stablecoins are digital assets typically pegged to traditional assets such as the U.S. dollar. Industry interest in stablecoins has grown since the passage of the Genius Act, a new U.S. stablecoin regulatory framework championed by President Donald Trump last year. The legislation institutionalizes stablecoins—cryptocurrencies with values fixed to existing currencies like the dollar. Trump signed the bill as part of his pledge to foster the cryptocurrency industry.
Forbes also cited Tesla CEO Elon Musk's remarks. In an interview last year, Musk said, "Advances in artificial intelligence and robotics could significantly change the economic structure," adding that "ultimately, energy could become real money. Bitcoin is based on energy." Forbes noted that some interpret this as Musk quietly supporting bitcoin.
