The Tether Treasury minted $1 billion worth of USDT few hours ago on the Ethereum blockchain, as reported by Spot On Chain. This large minting comes only several hours before Federal Reserve is believed to be making an interest rate cut during September 17-18 meeting. It is now highly likely for the BTC price to go up considering this new USDT if the Fed cuts the rate.
The #TetherTreasury minted 1B $USDT on #Ethereum ~3 hours ago.Notably, this minting comes just ahead of the expected interest rate cut by FED on Sep 17-18.Overall, in the past year, the Tether Treasury has issued a total of 35B $USDT, contributing to the rise of the #Bitcoin… pic.twitter.com/TYH4gtJRni
— Spot On Chain (@spotonchain) September 16, 2024
USDT Minting Trend Tied to Bitcoin’s Price Increase
In the last one year, the Tether Treasury has minted $35 billion worth of USDT. Looking at the impacts, this issuance has a significant effect on the price of Bitcoin. For instance, as massive USDT minting occurred in the same period, Bitcoin surged from roughly $26,600 to over $73,000 by March. This implies that there is a direct relationship between the creation of USDT and the Bitcoin price.
In the USDT minting process, new tokens are produced that are in turn secured by other assets owned by Tether. This means that the cash injected into the economy ends up in different assets, such as Bitcoin. In the past, after major mining operations, Bitcoin has undergone sharp ups or has maintained at higher levels.
It is a perception that the higher the number of minted USDT goes, the higher goes the price of Bitcoin. With Uptober approaching and Fed rate cut expectations, the market is getting closer to the beginning of the major bull run.
Market Awaits Fed Rate Cut Amid $1 Billion USDT Minting
With the anticipated interest rate cut, the market is set to be influenced greatly by the Federal Reserve. Rates of interest can affect the actions of investors and the recent USDT minting may also have this impact. While investors are waiting for the decision of the Fed, the addition of $1 billion in USDT can cause great fluctuations or corrections in the Bitcoin rate.
Lastly, this large-scale USDT minting, reported by Spot On Chain, aligns with the following US economic announcements, making the current cryptocurrency environment more volatile. These factors are expected to continue influencing the markets in the coming days and investors will be paying close attention to the outcome.