The issuance of stablecoins by companies like Tether (USDT) and Circle (USDC) continuously minting more coins is often a signal that money is flowing into the crypto market. These large minting events are usually accompanied by expectations of growth for Bitcoin and altcoins, because:
1. Increased demand from new investors: As the market warms up, many new investors enter, often using stablecoins for trading, leading to a demand for more minting.
2. Improved liquidity: Minting more USDT/USDC helps increase liquidity, making trading easier and boosting cash flow into major crypto assets like Bitcoin and Ethereum.
3. Historical support for price increases: In the past, such as late 2023, Tether's continuous minting contributed significantly to Bitcoin breaking its ATH.
However, it is important to note:
• Minting does not always mean price increase: If the amount of stablecoins minted is not actually used to buy crypto but merely stored, it may not create a significant impact on price.
• Observe cash flow: It is crucial to check whether the newly minted stablecoins are actually deposited on exchanges (for trading) or not. If they are, this will be a positive signal for the market.
Hopefully, with the current situation, the market will continue to maintain growth momentum as you expect!
