Stablecoins hold nearly $200 billion in US debt, but money funds bought the surge

Money-market mutual funds absorbed approximately 85% of the US government's latest Treasury-bill surge, giving traditional cash managers the clearest claim to the marginal demand behind the summer issuance wave.The Treasury Department said net bill supply grew by more than $550 billion in July and August, an increase of about 8% in two months. Money funds took down most of that additional supply, according to remarks delivered Sept. 22 by Deputy Treasury Secretary Francis Brooke.Stablecoin providers remain important holders of short-dated government debt. Treasury puts their holdings at nearly $200 billion. Yet that number measures a stock of Treasury bills and other close-to-maturity securities, while the money-fund figure measures purchases associated with a specific two-month supply increase. The categories can also overlap because stablecoin reserves may be invested through government money-market funds and repurchase agreements.The result is a more precise picture of crypto's role in government finance. Stablecoins are already material Treasury-linked investors and could become a larger source of demand as regulation takes shape. The documented incremental buying in 2026, howe...