Stablecoins have taken over as the largest holders of US Treasuries, surpassing major economies such as Germany and South Korea. According to recent data, Tether and Circle have collectively invested over $150 billion in stablecoins.
The introduction of the GENIUS Act has accelerated institutional adoption of stablecoins, allowing them to compete with traditional payment processors like Visa in transaction volumes and corporate treasury operations. This trend reflects investors’ demand for liquidity and stability amid macroeconomic uncertainty and geopolitical volatility.
As major economies reduce their Treasury holdings, stablecoin issuers are stepping in as potential long-term buyers, potentially reinforcing the dollar’s role in global finance. However, critics warn that a loss of public confidence in a major stablecoin issuer could introduce liquidity risks.
Regulators are under pressure to adapt existing frameworks to account for the unique characteristics of stablecoins and their growing influence in capital markets. With GDP growth expected to remain subdued in the second half of 2025, the demand for safe, liquid assets is likely to persist, further solidifying stablecoins’ role in the financial landscape.
Source: https://www.ainvest.com/news/stablecoins-overtake-major-economies-treasury-holdings-2508