> Eventually, the Fed itself will start issuing stablecoins and out-legitimize everyone else.

That would be a CBDC (Central Bank Digital Currency), which the current administration doesn’t seem to want. One advantage of such a CBDC would be that central banks of other countries could be persuaded to use them (for cross border payments and transfers), whereas a stable coin issued and managed by a group of banks would likely not have this advantage (not saying never though).