How will USDT’s growth affect Bitcoin [BTC]? According to this data….
- Tether invested a large portion of its profits in BTC.
- However, BTC miners became skeptical.
After the collapse of Silicon Valley Bank (SVB), Tether’s [USDT] biggest competitor, Circle [USDC], was seriously affected. Due to the FUD caused by this, USDT can take a large amount of market share in the stablecoins sector.
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A win-win for BTC and USDT?
As the overall profits generated by Tether, its parent company, skyrocketed, much of that revenue was allocated to buying US Treasury bills. However, there were other avenues where Tether invested. A large amount of their earnings were invested in Bitcoin [BTC].
According to the data, Tether has $1.5 billion worth of BTC in its reserves.
In the first quarter alone, Tether bought 52,670 BTC. If Tether continues to dominate the stablecoin market, there could be positive implications for BTC’s price.
As Andrew Kang, CEO of Mechanism Capital, a crypto investment firm, tired that if Tether continues to buy BTC with their profits, it could undermine the selling pressure on BTC that will occur due to US government holdings.
Source: Tether
At press time, the US government was seizing large amounts of Bitcoin that it plans to sell in four phases throughout the year.
The US government’s decision to sell these holdings has caused a huge amount of FUD in the market, with many traders believing that these sales could drive down the price of BTC.
However, if Tether continues its bullish behavior, there may be a possibility that the impact of US government actions may be nullified in the future.
HODLers remain calm
At press time, there wasn’t much selling pressure on Bitcoin, as addresses in profit had fallen to a one-month low. This indicated that many addresses currently holding BTC did not have much incentive to sell their holdings.
📉 #Bitcoin $BTC The number of addresses in profit (7d MA) just hit a 1-month low of 31,167,820,077
See calculation: pic.twitter.com/zVTHt6mrKV
— glassnode alerts (@glassnodealerts) 14 May 2023
Read Bitcoins [BTC] Price prediction 2023-2024
Although BTC addresses continued to HODL, Bitcoin miners did not show the same behavior. According to Glassnode’s data, Bitcoin mining increased. This behavior showed that many miners could face large amounts of selling pressure and have sold their holdings.
There will be a negative impact on BTC if this behavior from miners continues.
Source: Glassnode
