Tether’s $127 Billion in Treasuries Could Place It in Top Five by 2033

TLDR

• Tether’s $127 billion in Treasuries places it 18th in foreign holders as of mid-2025.
• Tether added $33.1 billion in 2024, setting it on track for top-five status by 2033.
• Tether’s ability to reinvest interest income boosts its growing U.S. Treasury holdings.
• Projections show Tether could reach the top five foreign holders by 2033 with continued growth.

Tether, the issuer behind the widely used USDT stablecoin, has been steadily increasing its holdings of U.S. Treasuries. As of mid-2025, the company controls approximately $127 billion in U.S. debt, positioning itself as the 18th largest foreign holder. Projections suggest that if Tether continues on its current path, it could break into the top five foreign holders by 2033, a significant milestone in its financial trajectory.

Tether’s Current Holdings and Trajectory

As of June 30, 2025, Tether’s exposure to U.S. Treasuries stands at $127 billion, with the majority of this in direct U.S. Treasury bills. The company has been an active buyer, with reported net additions of $33.1 billion in 2024, which equates to an average of about $2.8 billion per month.

This steady accumulation has positioned Tether as one of the largest private purchasers of U.S. government debt, securing it a spot as the 7th largest buyer in 2024.

However, with its rapid pace of accumulation and a conservative acceleration model, Tether is expected to rise in the rankings of foreign holders of U.S. Treasuries. Projections indicate that by 2033, the company could break into the top five, assuming it continues increasing its holdings at the current rate or slightly accelerates its purchases.

Key Factors Driving Tether’s Growth

Tether’s growth in Treasury holdings is largely fueled by the demand for its USDT stablecoin. As the supply of USDT increases, Tether’s reserves have grown in tandem. Tether maintains a significant portion of its reserves in U.S. Treasury bills and short-term U.S. debt instruments, allowing it to benefit from interest income that further supports its purchase capabilities.

In addition, Tether’s ability to reinvest earnings from its Treasury holdings into further government debt plays a critical role in its rapid accumulation. Should Tether continue to expand its stablecoin issuance, it could see its net additions rise, accelerating its progress toward the top five.

Projections for Top-5 Status by 2033

Using current data, the projections for Tether’s climb into the top five foreign holders are based on a combination of factors. These include Tether’s annual net additions, estimated to rise over time, and the moving threshold for the fifth-largest holder, which fluctuates due to custodial shifts. As of mid-2025, Belgium holds the fifth position with around $428 billion in U.S. Treasury securities.

For Tether to reach this threshold by 2033, it would need to add approximately $33 billion per year, assuming modest acceleration in its purchases. If the rate of acceleration increases slightly, Tether could achieve its goal even sooner. However, changes in the fifth-place holder’s position will affect the timeline, with custodial shifts contributing to the volatility of the threshold.

Challenges and Future Outlook

While entering the top five foreign holders is within reach for Tether, surpassing larger nations like Japan, the current largest holder at $1.15 trillion, would take considerably longer. Projections suggest that even with rapid growth in Tether’s acquisitions, surpassing Japan could take decades, as the gap between $127 billion and $1 trillion is substantial.

However, Tether’s trajectory to reach the top five highlights the growing importance of stablecoins in global financial markets. If the demand for USDT continues to grow, and Tether maintains its strategy of reinvestment and debt acquisition, its rise in the rankings of foreign U.S. Treasury holders is likely to continue. The market can absorb this increase in demand, but the shifting thresholds in Treasury holdings make it difficult to pinpoint an exact timeline for Tether’s entry into the top five.

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