The US Treasury is sticking with its playbook. On August 5, the department confirmed it will keep auction sizes for nominal interest-bearing securities and floating-rate notes unchanged, extending forward guidance that has been in place since early 2024 through at least mid-2027.
The T-bill trade-off
Bank of America analysts estimate that if current guidance holds, T-bills could constitute nearly 25% of total outstanding debt by the end of fiscal year 2027. That would be the highest proportion since 2004, excluding crisis periods like 2008 and 2020 when the government temporarily leaned on bills to fund emergency spending.
What this means for fixed income and stablecoins
Now here’s where crypto enters the frame. Stablecoin issuers like Tether and Circle have become some of the largest holders of short-term US government debt. Their reserves are heavily weighted toward T-bills and reverse repo facilities, precisely the instruments the Treasury is leaning on most heavily.
