Stablecoin issuers like Tether and Circle now hold $80bn worth of short-term US government debt, highlighting the expanding role of digital asset players in traditional financial markets.

Tether and its peers accounted for 2 per cent of the market for Treasury bills — debt instruments that are commonly used as a cash equivalent on corporate balance sheets — as of May, according to research from JPMorgan, more than the proportion owned by Warren Buffett’s investment behemoth Berkshire Hathaway. JPMorgan said the newer issuers had “considerable room to grow should stablecoins become a form of digital payment”.

The rising prominence of stablecoin issuers in a market historically dominated by lower-risk investors is one of the factors driving global financial regulators to step up their scrutiny of the broader crypto industry.