U.S. Treasury Securities
Debt instruments issued by the U.S. government, considered the safest financial assets in the world. They back the majority of USDC reserves.
U.S. Treasuries are how the federal government borrows money. They're considered "risk-free" because the U.S. government has never defaulted on its debt. They come in different maturities: Treasury bills (under 1 year), Treasury notes (1-10 years), and Treasury bonds (10-30 years).
USDC reserves are primarily held in short-dated Treasuries (maturing within 3 months) and overnight Treasury repurchase agreements. Short maturities are used because they're the most liquid, meaning they can be converted to cash quickly to meet USDC redemptions.
The interest earned on these Treasuries is how Circle makes money. As of early 2026, short-term Treasury yields are around 4-5%, meaning Circle earns billions annually on USDC reserves. This is the primary revenue model behind USDC.
Related Terms
Reserves
The pool of real-world assets (U.S. Treasuries, cash) held to back each USDC token at a 1:1 ratio.
Attestation
An independent third-party examination that verifies USDC reserves meet or exceed the amount of USDC in circulation.
Fiat-Backed Stablecoin
A stablecoin backed by real-world assets like cash and government bonds, held in reserve by the issuer.
Learn More
This definition is provided for educational purposes. USDC.org is an independent resource and is not affiliated with Circle Internet Financial.