A report from the San Francisco Federal Reserve, published on September 28, 2026, highlights the growing role of stablecoin issuers in the US Treasury market. Between 2021 and mid-2026, these issuers increased their holdings by approximately $200 billion, offsetting more than 40% of the decline in Chinese holdings of US government debt.
The research notes that stablecoin holdings have expanded more than tenfold over the past five years. Since 2023, purchases of short-term Treasury bills by these issuers have surpassed those of Japan. The activity remains highly concentrated, with the two largest stablecoins accounting for the majority of these investments.
The Federal Reserve projects that demand for short-term Treasuries from stablecoin issuers could reach approximately $400 billion by the end of 2030, provided current trends continue. However, the report warns that this concentration poses risks, as sudden redemptions could force issuers to liquidate their holdings rapidly.
Matt Hougan, CIO of Bitwise, reports that financial advisors are increasingly focused on stablecoins and tokenization rather than Bitcoin. In discussions with over 40 advisors managing assets exceeding $175 trillion, Hougan noted a shift toward real-world use cases in capital markets and payments.
