Money‑Market Funds Absorbed Most of Summer Treasury‑Bill Surge While Stablecoins Hold Nearly $200 B

The U.S. Treasury reported that money‑market mutual funds purchased the bulk of the recent surge in Treasury‑bill issuance, while stablecoin providers remain sizable holders of short‑dated government securities.

Summer issuance and money‑market fund participation

Deputy Treasury Secretary Francis Brooke said net bill supply grew by more than $550 billion in July and August 2026 – an increase of about 8 % over two months. Money‑market mutual funds absorbed roughly 85 % of that additional supply.

Stablecoin holdings of Treasury securities

The Treasury estimates that stablecoin issuers collectively hold nearly $200 billion in Treasury bills and other near‑maturity securities. This figure reflects a stock of holdings, not purchases tied to the July‑August issuance wave.

Overlap and accounting nuances

Stablecoin reserves can be invested through government money‑market funds and repurchase agreements, creating overlap between the two categories. For example, Circle disclosed that about 84 % of USDC reserves were held in the Circle Reserve Fund, a Rule 2a‑7 money‑market vehicle.

Other major buyers

• Federal Reserve: Purchased more than $300 billion of Treasury bills in 2026 via reserve‑management operations and reinvestment of agency‑security principal.
• Foreign residents: Increased bill holdings by $38.8 billion in July 2026, reversing a series of monthly declines.

Implications for crypto finance

Stablecoin issuers are already material investors in short‑term Treasury debt and could expand their role as regulatory frameworks, such as the GENIUS Act, are finalized. However, the recent supply surge was primarily absorbed by traditional money‑market funds.