A stablecoin’s dollar price is a promise, not a bank balance. The token stays near $1 because the issuer swaps it back for cash, and traders arbitrage any gap: when a coin trades at $0.99, someone buys it there and redeems it for $1.00, and that buying pushes the price back up. What makes the promise good is the reserve behind it. The reserve report is where you check that, and it matters more than the price on an exchange.
The two largest issuers report very different things. USDT, from Tether, held about $179.9 billion of the roughly $308 billion stablecoin market in early November 2026, and is backed mostly by cash and short-term Treasury bills, plus gold and bitcoin. USDC, from Circle, held about $71.3 billion and sits almost entirely in cash and Treasuries, most of it inside the Circle Reserve Fund. Tether publishes a quarterly attestation by the accounting firm BDO, dated September 30, 2026, showing $191.5 billion in reserve assets against about $184 billion in tokens, with $7.95 billion of excess. Circle publishes a monthly examination, with $73.96 billion in reserves against $73.88 billion of USDC in circulation.
An attestation is not an audit. BDO checks that the numbers match the company’s records on a given date; it does not vouch for the whole business. A reserve report is also a snapshot, and the assets inside it move. Tether valued its bitcoin at $83,621 per coin on September 30; at a lower spot price the same holding is worth less, and gold can move the same way. The excess reserves above tokens outstanding are the cushion that absorbs those swings.
That cushion also funds the business. The issuer keeps the interest on the reserves. With a 3-month Treasury bill yielding 4.21% in early November, every $1,000 parked in a cash-backed stablecoin earns its issuer about $42 a year while the holder earns nothing. That is the trade most people miss: the stability is paid for by handing the yield to the company that runs the coin.
Stablecoins do break, and the failures show where the risk lives. In March 2023, USDC fell to about 87 cents when $3.3 billion of its reserves was stuck at Silicon Valley Bank; the peg returned only after the US government guaranteed SVB deposits. In May 2022, TerraUSD, which held no cash reserves and leaned on a trading mechanism with its sister token, collapsed below $0.09 and never recovered. A cash-backed coin can wobble when a bank fails; a coin with no real reserves can go to zero.
The GENIUS Act, the first US federal stablecoin law, tightens these rules. It requires payment stablecoins to hold reserves one-to-one in cash, deposits, or short-term Treasuries, to publish monthly reports certified by the issuer’s executives, and it bars issuers from paying interest just for holding. The effective date is the earlier of January 18, 2027 or 120 days after final regulations. Until then, the rule for anyone holding stablecoins is the same as for a bank you cannot see: read the report, check the excess, and remember that the issuer, not the holder, keeps the yield.
Source: BTC-Pulse.