Stablecoin Titans Now Hold $182B in US Treasuries—Bigger Than UAE & South Korea’s Reserves
Crypto’s shadow banking system just flexed its sovereign-level financial muscle.
Stablecoin issuers now control a $182 billion stack of US Treasury bonds—enough to rank as the 17th largest holder worldwide. That vault surpasses the national reserves of economic powerhouses like the UAE and South Korea.
Who needs a central bank when you’ve got a blockchain and yield-hungry degens?
The numbers don’t lie: This parallel financial system keeps eating traditional finance’s lunch. Meanwhile, Wall Street still charges 2% fees for money market funds holding the same assets.
Treasury paper dominates reserves
Issuers buy short-dated government debt because it settles T-plus-zero at clearing banks, offers daily liquidity, and earns yields now above 5%.
latest assurance showed that Treasuries, repos, and Treasury-only money-market funds represented more than 80% of its collateral, helping drive $1 billion in first-quarter profit.
Circle uses BlackRock’s SEC-registered Circle Reserve Fund to hold its bills and repos, enabling same-day liquidation if redemptions spike.
Ardoino said that issuing stablecoins “creates incremental demand for US debt without relying on the banking system,” citing Tether’s ranking above that of Germany, the UAE, and Spain.
Circle and Paxos have made similar arguments in policy filings, noting that narrowly distributed, highly liquid collateral protects holders during market stress.
Regulatory backdrop
Lawmakers in Washington and Brussels are considering bills that would restrict reserve assets to cash and short-term Treasury securities, maintaining the current composition but limiting diversification into Gold or corporate bonds.
The GENIUS Act, which cleared the Senate in June, would formalize those limits. At the same time, Europe’s Markets in Crypto-Assets (MiCA) regime already bars commodities for euro-pegged coins.
Stablecoin treasurers say the proposed rules align with their investment profile, though they warn that concentration in one asset class links stablecoin liquidity to Federal Reserve funding conditions.
