Stablecoin Issuers Absorb US Treasury Bill Demand After Foreign Investor Backlash

Stablecoin issuers have taken on a significant role in replacing foreign investors who dumped US Treasury bills in June, according to recent data. The $29 billion worth of T-bills sold by foreign investors is a stark contrast to their buying spree of $181.4 billion in US stocks during the same month.

This trend marks the second consecutive month that foreign investors have sold off US Treasury bills, with stablecoin issuers stepping in to absorb this demand. Notably, Tether holds around $115 billion of US Treasury bills, while Circle routes its USDC reserves through a BlackRock money fund.

The GENIUS Act and the Treasury's August 17 rule have finalized the regulatory framework for stablecoins, paving the way for these issuers to continue replacing foreign investors in the market. The September 16 TIC report will confirm whether this trend of stablecoin issuers buying up US Treasury bills has continued.