Federal Reserve researchers say that by the end of 2024, the size of US treasury bonds held by Cayman Islands' hedge funds exceeded the official US data value, which is probably 1.4 trillion US dollars higher than the value reported by the latter. Researchers such as Daniel Barth and Daniel Beltran wrote in an October 15 report that the holdings of these funds reached 1.85 trillion US dollars in December, an increase of 1 trillion US dollars since 2022. A US Treasury report said their holdings were 423 billion dollars. These Federal Reserve researchers said their data showed that the Cayman Islands is America's largest overseas creditor, surpassing China, Japan, and the United Kingdom. The researchers wrote that this discrepancy may be due to the fact that official data does not fully reflect transactions related to so-called base difference trading; through base difference trading, hedge funds shorted US Treasury futures and bought cash to profit from the spread. They added that hedge funds use purchased cash US bonds as collateral to borrow money in the repurchase agreement market to finance base difference transactions. Once used as collateral, ownership of US bonds may be difficult to track. According to the researcher mentioned above, in the opinion of the custodian, they may have been sold, but in reality the ownership may still belong to the hedge fund.

Federal Reserve researchers say that by the end of 2024, the size of US treasury bonds held by Cayman Islands' hedge funds exceeded the official US data value, which is probably 1.4 trillion US dollars higher than the value reported by the latter. Researchers such as Daniel Barth and Daniel Beltran wrote in an October 15 report that the holdings of these funds reached 1.85 trillion US dollars in December, an increase of 1 trillion US dollars since 2022. A US Treasury report said their holdings were 423 billion dollars. These Federal Reserve researchers said their data showed that the Cayman Islands is America's largest overseas creditor, surpassing China, Japan, and the United Kingdom. The researchers wrote that this discrepancy may be due to the fact that official data does not fully reflect transactions related to so-called base difference trading; through base difference trading, hedge funds shorted US Treasury futures and bought cash to profit from the spread. They added that hedge funds use purchased cash US bonds as collateral to borrow money in the repurchase agreement market to finance base difference transactions. Once used as collateral, ownership of US bonds may be difficult to track. According to the researcher mentioned above, in the opinion of the custodian, they may have been sold, but in reality the ownership may still belong to the hedge fund.