Money funds bought most of summer bills; stablecoins hold $200B

The Treasury Department reported that money-market mutual funds purchased roughly 85% of more than $550 billion in Treasury bills issued in July and August. Treasury’s buyer breakdown attributes the bulk of the incremental supply during that two-month period to traditional cash managers.

In remarks on Sept. 22, Deputy Treasury Secretary Francis Brooke said money funds “took down most of that additional supply.” The 85% estimate applies only to the extra bills issued over July and August, not to the full stock of Treasury bills outstanding.

Treasury data show stablecoin providers held nearly $200 billion of Treasury bills and other securities close to maturity at a point in time. That figure measures a stock of holdings and does not identify how much of the allocation was purchased during the summer issuance surge. Stablecoin reserves can be invested through government money-market funds and repurchase agreements, creating overlap between the stablecoin and money-fund categories.

The Federal Reserve purchased more than $300 billion of bills in 2026 through reserve-management operations and reinvestment of principal from agency securities. Those purchases occurred in the secondary market and are recorded on the Fed’s balance sheet: bill holdings rose from $233.592 billion on Dec. 31, 2025 to $550.482 billion on Sept. 16, 2026 in the H.4.1 releases.

Treasury International Capital data showed foreign residents increased their bill holdings by $38.8 billion in July. Private foreign holdings rose by $45.0 billion that month while foreign official holdings fell by $6.3 billion. TIC data reflect custody and one-month changes in holdings rather than an allocation of auction demand.

Issuer disclosures illustrate how reserve structures channel demand. Circle reported about 84% of USDC reserves were held in the Circle Reserve Fund, a government money-market fund, at June 30. Circle’s annual shareholder report for the period ending April 30 listed $19.111 billion of direct Treasury obligations and $46.998 billion of repurchase agreements collateralized by Treasuries.

Treasury noted stablecoin providers “may continue expanding and add to their Treasury holdings” as rules implementing the GENIUS Act are finalized. The department described that as a possible regulatory channel for future demand, not as a quantified estimate of summer buying.

Treasury officials emphasized the figures use different measurement windows and are not additive: the money-fund share isolates purchases tied to the July–August supply increase; the stablecoin figure is a snapshot of holdings; the Fed number reflects cumulative balance-sheet changes through Sept. 22; and the foreign figure records a one-month shift in July.

For the July–August issuance wave, Treasury identified money-market mutual funds as the clearest marginal buyers. The data also show significant bill holdings on the Fed balance sheet, a July rebound in foreign demand, and a substantial stock of short-dated Treasuries held by stablecoin issuers.