The US Department of the Treasury has highlighted the growing role of stablecoins in the Treasury market, specifically Ripple stablecoin RLUSD, USDT, and USDC.
Stablecoins are gaining significant attention in the United States, with their superior transactional capabilities compared to traditional financial systems being a major lure. A stablecoin bill, the GENIUS Act, has recently moved to the final approval stage in the US Senate as efforts to create a regulatory framework for the sector, teased to attract trillions of dollars to the US economy, gain momentum.
A presentation by the US Treasury Department to the TBAC highlighted the growing demand for stablecoins and their potential impact on the Treasury market. The report compared four major stablecoins, including USDT, USDC, and RLUSD.
Stablecoin Impact on US Treasury Bills
The presentation revealed the self-reported reserves of four major stablecoins, as reported by their issuers: Tether’s USDT, Circle’s USDC, Ripple’s RLUSD, and PayPal’s PYUSD. Notably, this was their reserve balance as of December 2024, with USDC being the only stablecoin for which the department used its figures as of 17 April 2025.
The report highlighted specific metrics, including the reverse repo, money market funds, cash, US T-Bills, and average T-Bill residual duration.
For context, USDT’s reserve comprises $17.2 billion (12%) in reverse repurchase agreements (repo), $6.5 billion (4.5%) in the money market, $100 million in cash (0.1%), $94.5 billion (65.7%) in US Treasury bills, and $25.4 billion in other investments like Bitcoin.
Furthermore, USDC’s reserve consists of $53.3 billion (88.8%) in money market funds and $6.7 billion (11.2%) in cash. On the other hand, RLUSD is backed by $30.1 million (36.3%) in the money market, $23 million (27.5%) in cash, and $30.1 million (36.2%) in US Treasury bills.
PYUSD has a reported reverse repo of $488 million (95.8%) and $21.4 million (4.2%) in cash. Notably, this highlights the significant allocation to US Treasury bills among notable stablecoin issuers.
Excerpt from the US Treasury Stablecoin Report
Allocation to T-Bills Projected to Increase Exponentially
Interestingly, the US Treasury estimated that stablecoin issuers would continue to grow their allocation to T-bills as adoption increases. It noted that the requirements of the GENIUS Act, which is near passing, would impact stablecoin reserve exposure to the federal financial vehicle.
According to estimates, the value of US Treasury bills held by issuers is expected to increase 8.3 times from its $120 billion figure in 2024 to $1 trillion by 2028. This excludes the possibility of interest-bearing stablecoins, an act that both stablecoin regulations (GENIUS and STABLE Act) currently under consideration in the Senate prohibit.
Meanwhile, the stablecoin market has grown to a $250 billion sector, with a recent projection from CoinFund’s David Pakman suggesting it will hit $1 trillion by the end of 2025.
