Circle's USD Coin (USDC) held $73.1 billion in total reserves as of July 23, 2026, against $72.9 billion in circulation, according to the company's latest attestation. The reserves are split across three buckets: cash in bank accounts for immediate redemptions, short-dated U.S. Treasuries for principal safety, and overnight Treasury repurchase agreements for same-day liquidity. The majority sits in the Circle Reserve Fund, a government money market fund managed by BlackRock that can hold all three asset types.
State Street's New Fund for Stablecoin Reserves
State Street entered the stablecoin reserve business on June 8, 2026, with the launch of the Stablecoin Reserves Money Market Fund (ticker: SSRXX). As of June 30, the fund held about $121 million in net assets. Its portfolio is heavily weighted toward Treasury repurchase agreements — roughly 95.77% — with the remaining 4.23% in direct Treasury debt. The fund is designed to give stablecoin issuers a regulated vehicle for parking reserves while earning yield.
How the Buckets Work
Stablecoin reserves aren't just a pile of cash. The three-bucket structure — bank cash, short Treasuries, and overnight repos — balances liquidity against yield. Bank cash lets issuers handle redemptions on demand. Short-dated Treasuries protect principal if interest rates move. Overnight Treasury repos provide same-day liquidity while earning a small return. Issuers collect the interest on these holdings; users generally don't unless the stablecoin's terms say otherwise.
Regulatory Guardrails
Government money market funds like the Circle Reserve Fund operate under the SEC's Rule 2a-7. That rule imposes strict limits on credit quality, maturity, and portfolio liquidity. Funds can only hold securities backed by the U.S. government or its agencies, and they must maintain minimum daily and weekly liquid asset thresholds. Those constraints are meant to prevent the kind of runs that hit money market funds in 2008 and 2020.
Market-Level Effects
At scale, stablecoin reserve allocations can nudge Treasury yields and repo market conditions. The Bank for International Settlements flagged this in its Annual Economic Report 2026, noting that large, concentrated holdings by stablecoin issuers could amplify short-term funding pressures. With USDC alone holding $73 billion in reserves, the BIS warning isn't hypothetical — it's a live question for regulators watching how these funds interact with the broader financial system.
State Street's fund is still small relative to the market, but its entry signals that traditional asset managers see stablecoin reserves as a growth business. Whether the SEC tightens its rules on how these reserves are managed, or whether issuers start shifting more into direct Treasury holdings to reduce repo exposure, remains an open question.
