Stablecoin issuers have become a significant buyer of U.S. Treasury securities, adding approximately $200 billion to their holdings between 2021 and 2026, according to a September 28, 2026, Economic Letter from the San Francisco Federal Reserve Bank. More than 40% of the decline in China’s Treasury holdings over the same period was offset by these purchases. Most buying came from the issuers of the two largest stablecoins, whose Treasury holdings increased more than tenfold in five years. Stablecoins are crypto tokens designed to maintain a stable value, while Treasury bills are short-term U.S. government debt. Issuers have concentrated on short-term instruments because they must be able to redeem tokens for dollars on demand. Since 2023, they have bought more short-term Treasury bills than Japan, the largest non-U.S. holder of Treasuries. If current growth continues, issuer demand could reach approximately $400 billion by the end of 2030, though the researchers describe that as a projection rather than a guarantee. The letter identifies stablecoin issuers as an emerging private-sector source of Treasury demand as the foreign share of Treasury holdings fell from more than 50% in 2008 to roughly 30% in early 2026. China reduced its holdings during that period, while stablecoin issuers favored liquid, short-dated dollar assets. The 2025 GENIUS Act established a federal framework requiring authorized domestic stablecoin issuers to back tokens one-to-one with high-quality liquid assets such as Treasury bills. The San Francisco Fed said this demand could affect short-term yields, although it remains small relative to overall U.S. fiscal financing needs. The concentration of purchases among two token issuers also creates a potential vulnerability, as large redemptions could result in sizable short-term bill sales. The key measure is whether stablecoin Treasury holdings continue tracking toward the roughly $400 billion projection for 2030.