Tether’s United States dollar-pegged stablecoin USDT keeps raising the bar in the digital asset industry. Today, USDT has surpassed the record $120 billion market capitalization. This is the first time it has reached such a level, signaling a potential crypto rally. Noteworthy, increasing stablecoin supply is usually an indication of imminent bullish momentum.
Stablecoin Supply And Bitcoin Price
It is perceived that the growing stablecoin supply could catalyze the next Bitcoin (BTC) rally. Historical data has shown that this is possible. Two months ago, Tether recorded the minting of $1.3 billion of USDT within five days. This was after Bitcoin price bottomed at a five-month low of above $49,500 on August 5.
Four days after BTC tanked, the $1.3 billion USDT triggered a price pump for the flagship cryptocurrency. Bitcoin recorded over 21% price recovery to trade at $60,271. In this case, the USDT market cap surge and the potential launch of Ripple’s stablecoin RLUSD may cause BTC to rally.
Tether Transfers USDT to CEXs
A significant portion of Tether’s treasury is going to some of the major centralized exchanges (CEXs), suggesting that strong investor buying pressure is looming. According to the blockchain analytics platform Arkham Intelligence, up to $66 million of stablecoins have been sold through Binance. Another $20+ million worth of USDT was also sent to the Kraken exchange.
If inflows in the stablecoin niche are impeded, the broader crypto market may be impacted. On August 12, Bitcoin dipped below the $60,000 psychological mark. This staged a near 4% correction as institutions temporarily halted their purchase of USDT. Judging by October’s history as a bullish month, analysts expected Bitcoin to record a three-month rally.
Bitcoin Registers Price Gain
They hoped that the coin would surge to $92,000 after the downtrend it recorded in September. Recently, BTC’s market cap reached an impressive $1.35 trillion, further expanding its lead over Ethereum, which is at $324.87 billion. So far, Bitcoin has seen some price improvement and is trading at $68,578.65 after gaining 0.68% in the last 24 hours.
Meanwhile, Arthur Hayes, co-founder of BitMEX, predicted a potential surge in Bitcoin prices. He tied his prediction to the outcome of the tensions in the Middle East. According to the crypto leader, should the tension escalate, global oil and energy prices would increase.
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