The government says:

"Private stablecoins were too risky. We need a secure, government-backed digital dollar for everyone. Every citizen will get a Fed wallet."

This is the perfect pretext for:

Digital central bank money lite: Not exactly CBDC, but a "GENIUS 2.0" wallet—every American gets a government-backed account. Europeans copy it with a digital euro.

UBI as a stabilizer: To stop the recession after the interest rate shock, an airdrop will be carried out. $500 per person globally in a new stablecoin that is only valid for 90 days. Just like the stimulus checks in 2020, only this time in minutes to 8 billion wallets.

Debt reduction through devaluation: The old $37 trillion debt still exists, but the Fed has just created $2-3 trillion in new balance sheet funds to buy T-bills. Inflation will rise to 12-15% for two years. In real terms, the old debt will shrink by 30%. The new debt is shared globally because everyone holds the new wallet dollar.

That's the "debt reduction and redistribution" formula from your question.

WAVE 3: The next 2-5 years - The new order

What remains:

The dollar remains hegemon, but differently: no longer via banks and SWIFT, but via mobile phones. Every farmer in Africa holds dollar stablecoins because their local currency is devaluing even faster. 99% market share remains.

Cash practically dies: once you've given everyone a Fed wallet and said "that's the only place the bailout money goes," no one will go back to cash.

Control: Every token is programmable and can be frozen by law. This is already enshrined in the GENIUS Act. After the crash, this feature will be used. Money laundering will become extremely difficult, but financial privacy will also be a thing of the past.

For assets like BSV/BTC: In the short term, they will crash along with everything else because everything will be liquidated. In the medium term, they will be the only assets outside the Fed bailout circuit. That's why many Bitcoiners see such a run as bullish for decentralized chains in the long run—because trust in "private, yet government-backed" stablecoins has been shattered.

In short: The crash wouldn't be the end of the dollar system, but rather its upgrade. From dollar hegemony 1.0 (via banks, bonds, and the military) to dollar hegemony 2.0 (via wallets on every mobile phone, backed by forced demand for US debt).

That's why they wrote the law exactly that way. They know the run could come. And they've already built in the answer: The Fed is buying.