JPMorgan: Tether, Circle, and other stablecoin issuers now hold $80B of short-term US government debt, accounting for 2% of the Treasury bills market as of May
Ownership highlights how digital asset players are encroaching on traditional markets — Stablecoin issuers like Tether … Tweets: @eden_holdings Tweets: @eden_holdings : “Tether and its peers accounted for 2 per cent of the market for Treasury bills - More than the proportion owned by Warren Buffett's investment behemoth Berkshire Hathaway.” https://www.ft.com/...
Context & Ripple Effects
The $80B JPMorgan tally is the endpoint of a reserve migration the coverage has tracked step by step: Tether disclosed $30B in commercial paper back in mid-2021, then cut that book to $20.1B by May 2022 after a depeg episode that forced $8.5B+ in redemptions pushed it toward safer, more liquid government paper.
The trajectory has only steepened since — by end-March 2025 Tether alone reported total US Treasury exposure nearing $120B alongside $1B+ in quarterly profit from traditional investments, while USDT supply nears ~$182B and USDC ~$75B. JPMorgan's point is that this is no longer one company's balance-sheet choice but an asset class: stablecoin issuers collectively out-rank Berkshire Hathaway in the T-bill market.
First-order effects
- JPMorgan now counts Tether, Circle and peers as a distinct, measurable investor bloc in short-term government debt — 2% of the Treasury bills market as of May, ahead of Berkshire Hathaway's share.
- Reserve composition at the big issuers has shifted decisively from corporate commercial paper to US government debt, changing what backs every dollar of USDT and USDC in circulation.
Second-order effects
- Redemption stress transmits directly into funding markets: Tether's own depeg-and-redemption run showed how fast reserve assets get liquidated, meaning crypto turmoil now touches the same instruments money funds trade.
- Contagion reshuffles market share rather than shrinking it — when Tether wobbled, USDC picked up $3.4B and Binance USD $1.2B, so Circle's regulatory wins (its national digital-currency trust bank approval) position it to absorb flights from less-trusted reserves.
Third-order effects
- If issuance keeps compounding on the current user-growth curve (500M claimed users), stablecoin issuers become structurally significant Treasury holders whose solvency is a macroprudential question, not just a crypto one.
- Circle's trust-bank charter points to where the structure lands: issuers regulated like narrow banks or money funds, with reserve quality and redemption mechanics policed because their failure would no longer be containable inside crypto.
The trend: Stablecoin reserves are migrating into US government debt, turning crypto issuers into systemically sized Treasury investors that regulators will increasingly treat like money-market institutions.