Author: Helen Partz, CoinTelegraph; Translation: Bai Shui, Golden Finance
Crypto financial services platform Matrixport stated that the market capitalization and trading volume of Tether USDT have recently dropped by billions of dollars, but this is not enough to indicate bearish signs in the market.
According to data from CoinGecko, since reaching a peak of $141 billion on December 19, 2024, the market capitalization of Tether's USDT stablecoin has decreased by 2.8%.
In the past few weeks, USDT trading has also significantly declined, with daily trading volume plummeting 64% from about $154 billion in mid-December to $55 billion on January 6, 2025.
However, Matrixport stated in a post on X on January 6 that the downward trend of USDT may be a result of slowed holiday trading and should not be associated with a bearish shift in the cryptocurrency market.
Matrixport predicts that bullish momentum will soon return.
In the article, Matrixport mentioned that an increase in stablecoin trading volume is often a bullish indicator for the cryptocurrency market, reflecting more fiat currency flowing into the ecosystem.
"However, when these trends reverse, it often signals that Bitcoin and the broader cryptocurrency market will enter a consolidation phase," Matrixport reported.
Source: Matrixport
Matrixport wrote: "Although Tether's market capitalization has recently declined and trading volume has gradually decreased, it may be too early to be bearish now."
"These trends may simply reflect seasonal lows during the Christmas holiday. With the arrival of the New Year, we will soon see whether the market's bullish momentum will return."
Matrixport is not the only company emphasizing the current phenomenon of holiday liquidity issues.
On January 4, CryptoQuant analyst Axel Adler stated that Bitcoin needs to accumulate more trading volume to generate strong bullish momentum, which may appear after the market recovers from the holidays.
The community fiercely criticizes the FUD surrounding Tether and MiCA
Matrixport's remarks on Tether came in response to earlier reports linking USDT's market decline to the full implementation of the EU's crypto asset market regulation (MiCA).
While some online reports suggest that European cryptocurrency exchanges should delist Tether's USDT before December 30, 2024, local regulators have not provided such guidance.
The European Securities and Markets Authority (ESMA) is the main supervisory authority for MiCA compliance and has repeatedly refused to comment on the status of USDT under MiCA even after the December 30 deadline.
After Coinbase delisted USDT, trading of USDT continued across Europe, with exchanges like Binance stating at the end of 2024 that they would continue to support USDT on the platform until further notice.
Source: Nostradamus
Many community members on X vehemently criticized reports about USDT being delisted from major exchanges in the EU, calling such reports fear, uncertainty, and doubt (FUD).
An industry observer wrote on X on January 6: "All the 'news' about Tether USDT being delisted from major global cryptocurrency exchanges due to the EU MiCA legislation is just FUD."
