Stablecoin Issuers Hold $182 Billion in US Treasuries, Surpassing South Korea and UAE

Four major US-dollar stablecoin issuers collectively hold approximately $182 billion in US Treasury bills. This substantial amount places them at the 17th position on the Treasury Department’s country-by-country ranking, surpassing the holdings of South Korea and the United Arab Emirates, and falling just short of Norway’s $195.9 billion.

Tether’s USDT leads the group, with its first-quarter attestation revealing $120 billion in Treasuries. CEO Paolo Ardoino later stated that the firm held “more than $125 billion” and continues to expand its holdings. Circle’s May accountant’s report listed $28.7 billion in T-bills and $26.5 billion in overnight repos, totaling $55.2 billion backing USDC. First Digital’s May 31 dashboard showed $1.665 billion in FDUSD reserves, with 78% held in Treasury bills, amounting to roughly $1.3 billion. Paxos’ PayPal USD (PYUSD) uses overnight reverse-repo agreements collateralized 97% by Treasuries, with $878 million outstanding, implying roughly $880 million in government debt.

According to US Treasury data from April, these positions total $182.4 billion, enough to surpass South Korea and the United Arab Emirates and fall just shy of Norway. Issuers prefer short-dated government debt because it settles T-plus-zero at clearing banks, offers daily liquidity, and earns yields now above 5%. Tether’s 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 noted 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. 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.