U.S. Treasury Secretary Scott Bessent has downplayed concerns about a potential sell-off of U.S. Treasuries amid rising tensions between the U.S. and Europe over Greenland. Speaking at the World Economic Forum in Davos, Switzerland, Bessent dismissed the idea of a global sell-off as a "false narrative" and "media hysteria". He insisted that U.S. debt remains a safe investment and urged world leaders to remain calm.

Tensions escalated following President Trump's renewed interest in acquiring Greenland, an autonomous territory of Denmark. Trump has suggested tariffs on European allies who oppose the acquisition. Bessent has defended the administration's stance, arguing that Greenland is vital for U.S. national security and a new national missile defense system, dubbed the "Golden Dome". He also criticized European leaders for projecting "weakness" in Arctic defense.

In response to Trump's tariff threats, some international investors have reportedly begun selling off U.S. Treasuries. A Danish pension fund, Akademikerpension, announced it would sell all of its U.S. Treasury holdings, citing "poor U.S. government finances," although the fund claimed the decision was unrelated to the Greenland situation. This sale amounts to approximately $100 million.

Despite these actions, Bessent remains unconcerned. He characterized Denmark's U.S. Treasury investment as "as insignificant as Denmark itself" due to its small size. He highlighted the U.S. Treasury market's strong performance and liquidity, noting it was the best-performing bond market among G7 countries since 2020. He also pointed out that the U.S. Treasury market has been setting records for foreign investment.

Bessent argued that a mass sell-off by European countries is illogical. He suggested that if European nations were to sell Treasuries, they would likely have to buy Chinese Renminbi, which would strengthen their own currencies – a move contrary to their current policy preferences. He stated there is "no talk in European governments" about retaliatory financial measures.

Bessent expressed confidence that the U.S. and European countries would find a solution regarding Greenland. He dismissed concerns about a potential trade war, urging everyone to "calm down the hysteria". He suggested the issue is relatively new and a solution would be found that ensures national security for both the U.S. and Europe. He also quipped that the European Union's likely response would be to form a "dreaded 'European working group'".

European Union foreign policy chief Kaja Kallas stated the bloc would "hold its ground" on Greenland and stressed that Trump's threatened tariffs would undermine the prosperity of both the EU and the U.S. The European Union is planning an emergency summit to weigh its response to the situation.