Tether (USDT) Surpasses Canada, Germany as the Largest Foreign Buyer of U.S. Treasury Securities

Tether, the issuer behind USDT, the world's largest stablecoin USDT secured position seven among the largest foreign buyers of U.S. Treasury securities

Tether, the issuer of the world’s largest stablecoin USDT, secured position seven among the largest foreign buyers of U.S. Treasury securities for 2024.

The company acquired $33.1 billion worth of U.S. Treasury bonds, placing it above several major economies, Paolo Ardoino revealed in a statement on Monday.

As the company continues its rapid expansion through increased participation in U.S. government-backed securities, it becomes one of the top purchasing entities. For instance, Canada, Mexico, and Germany.

While Tether’s holdings rank it seventh globally, the Cayman Islands—a leading jurisdiction for hedge funds—are the top purchaser of U.S. Treasuries with over $100 billion in acquisitions.

However, Ardoino highlighted that Tether’s figures represent investments from a single entity, in contrast to the broader holdings from regions like the Cayman Islands and Luxembourg, which involve multiple hedge funds.

Tether opted to invest in U.S. Treasuries as part of its USDT stability strategy for maintaining the U.S. dollar-pegged stablecoin.

The role of U.S. Treasuries as reserves enhances Tether’s stablecoin credibility as they establish global safety and liquidity standards, maintaining trust for potential token users.

The company’s involvement in the U.S. Treasury market is part of a broader shift in the global financial landscape, driven by the increasing use of cryptocurrencies and stablecoins.

As stablecoins expand their market influence, showcasing how U.S. dollar-supported stablecoins play an essential role in the U.S. Treasury debt market becomes crucial.

Stablecoins are rapidly growing in the market, and U.S. lawmakers and financial regulators have started to pay attention to them.

Furthermore, stablecoins are advancing to become key drivers that affect U.S. Treasury supremacy.

Tether brings the U.S. Dollar to more than 400 million people predominantly in emerging markets and developing countries.

Without doubts Tether built the biggest distribution network for the U.S. Dollar, physical and digital, in the history of humanity. https://t.co/3WpQNx5FLj

— Paolo Ardoino (@paoloardoino) March 20, 2024

Recently, U.S. Treasury Secretary Scott Bessent highlighted that crypto and stablecoins are essential in ensuring the global influence of the U.S. dollar.

Former President Donald Trump also expressed this sentiment during a recent appearance at the Digital Asset Summit, stressing that crypto could further strengthen the dollar’s global position.

Tether’s substantial holdings of U.S. Treasuries are also part of a broader shift in the stablecoin market.

According to analysts, the growing market capitalization of stablecoins, which surpassed $219 billion, suggests that the market is still in a mid-cycle phase rather than reaching its peak.

The adoption of stablecoins in the U.S. Treasury market comes during lawmakers’ push to define regulations for the stablecoin sector.

Kristin Smith, CEO of the Blockchain Association, believes that adequate stablecoin regulatory laws could be finalized by August 2025.

The proposed legislation aims to establish a framework for the expanding stablecoin market so stablecoins can maintain their position as trustworthy financial systems. Nonetheless, they could face difficulties in the fast-evolving crypto sector.

Moreover, the integration of stablecoins in the U.S. Treasury market is part of a broader narrative about the role of digital assets in the global financial system.

As the dust settles on the 2024 presidential election and the new Congress convenes, the focus will shift to the types of policies they will prioritize.

This includes completing the bipartisan stablecoin legislation that began in the previous Congress.

The post Tether Among Top Foreign Buyers Of U.S. Treasury In 2024 As Stablecoin Use Soars appeared first on Benzinga.