Data shows that the Tether (USDT) market cap is almost $90 billion. Here’s why this growth could matter for the price of Bitcoin. Tether Market Cap Has Continued To Observe A Rise Recently Tether is a cryptocurrency pegged to the US Dollar, meaning its price remains stable around the $1 mark. The asset is the most famous such “stablecoin” in the sector, with its market cap outstripping any other stable’s. As the market intelligence platform IntoTheBlock pointed out, the largest stablecoin supply has only continued to grow recently. The chart below shows the trend in the market caps of the various stablecoins in the cryptocurrency sector over the past year. Looks like the metric has been growing for USDT in recent days | Source: IntoTheBlock on X As displayed in the above graph, Tether has observed an overall uptrend during the past year, while USD Coin (USDC), the next largest competitor, has observed outflows as its market cap has fallen. Related Reading: Sleeping Bitcoin Giants Wake Up: Pattern Mirrors 2021 Bull Run The chart also puts into perspective how small the other stables are when compared to these two assets, making them perhaps insignificant for the wider market. What relevance does a large stablecoin like Tether have for Bitcoin and other coins in the sector? The answer to that question lies in what the stablecoins represent. Generally, investors make use of stables whenever they want to avoid the volatility associated with the other assets in the sector. The holders keeping their capital locked in these fiat-tied tokens usually plan to return towards the volatile side, however, as they would have gone for fiat itself if they wanted to keep away from cryptocurrency altogether. When such investors finally move back towards coins like Bitcoin, they naturally put buying pressure on their prices. For this reason, the supply of stablecoins could be considered the “potential buying supply” for BTC and others. There are two ways the USDT market cap grows. The first is an influx of fresh capital directly going to the asset, which is naturally a bullish development as it means the total capital in the sector goes up. The second is through a swap from another coin like Bitcoin. In this case, the overall capital present in the sector wouldn’t change, as it’s just a reshuffling, but whatever asset is being sold in favor of the stablecoin would naturally see some decline. Related Reading: Analyst Says Solana At Risk Of Pullback: Here Is The Target The most bullish scenario for the market is, therefore, when both the BTC price and Tether market cap head up, as it implies, a fresh influx of capital is happening towards both the coins. As analyst James V. Straten explained in a post on X, the correlation between the USDT market cap and BTC has almost hit 100% during this latest rally, as both have shot up. The value of the metric seems to have been high recently | Source: @jimmyvs24 on X The USDT market cap continuing to grow in these circumstances is certainly an optimistic sign for the current rally, as it means that all this dry powder that’s accumulating could potentially be deployed into Bitcoin should the surge slow down, helping extend the move further. BTC Price Bitcoin had breached the $44,000 mark earlier in the past day, but the asset has since seen some pullback as it’s now back around $43,800. BTC has continued to observe a strong surge during the past day | Source: BTCUSD on TradingView Featured image from iStock.com, charts from TradingView.com, Glassnode.com, IntoTheBlock.com
Grafico Azioni Solana (COIN:SOLUSD)
Storico
Da Feb 2024 a Mar 2024 Clicca qui per i Grafici di Solana
Grafico Azioni Solana (COIN:SOLUSD)
Storico
Da Mar 2023 a Mar 2024 Clicca qui per i Grafici di Solana