How the Model Could Work
How the Model Could Work
How the Model Could WorkThe conceptual economics are simple. A payment stablecoin typically holds reserves in cash, U.S. Treasury bills, repo and money-market instruments. Circle explicitly says its reserve return rate historically tracks close to prevailing SOFR, and USDC reserves currently include deposits, Treasury repo and sub-three-month Treasuries, including assets in the BlackRock-managed Circle Reserve Fund. Paxos says USDG and other Paxos-issued USD stablecoins are backed by U.S. dollar deposits, Treasuries and cash equivalents. Tether says its reserves are majority government-backed instruments and liquidity facilities, with around $141 billion of Treasury-bill exposure as of March 31, 2026.