Tether, the largest stablecoin in the world, has recently created an additional $1 billion, pushing its market capitalization above $110 billion. This surge could potentially drive Bitcoin to reach new all-time highs.
The Treasury of Tether has minted $1 billion worth of USDT in the past 24 hours, bringing its total for the year to $31 billion. According to a post from Lookonchain on May 17, this newly minted USDT played a significant role in the rise of Bitcoin’s price from $27,000 to $73,000.
Tether’s impact on Bitcoin’s rally doesn’t stop there. The company has announced that it will invest 15% of its net profit into Bitcoin in order to diversify the assets backing the stablecoin. On March 31, Tether acquired 8,888 Bitcoin valued at $618 million, making it the seventh-largest holder of Bitcoin in the world. Currently, Tether’s wallet holds over 78,317 BTC worth over $5.18 billion, a year after revealing its plan to diversify into Bitcoin.
At the same time, Bitcoin’s price movement continues to rely heavily on institutional inflows into spot Bitcoin exchange-traded funds (ETFs). The inflows from US Bitcoin ETFs have experienced net positive outflows for the second consecutive week, accumulating over $200 million in cumulative net flows so far, according to Dune.
Institutional inflows from ETFs played a significant role in Bitcoin’s recent rally to new all-time highs. As of February 15, Bitcoin ETFs accounted for approximately 75% of new investments in the world’s largest cryptocurrency as it surpassed the $50,000 mark.
Bitcoin’s price action has confirmed a breakout on the daily chart, with the $65,000 level serving as strong support for BTC, according to TradingView. Additionally, on the monthly chart, Bitcoin has successfully turned its previous resistance into support, a bullish sign for investors, as highlighted by popular crypto analyst Rekt Capital.
However, ScorehoodAI, an artificial intelligence-based predictions algorithm, suggests that Bitcoin may experience a temporary correction to below $63,500 before reclaiming the psychological $70,000 mark, as mentioned in a post on May 16. Such a correction would result in the liquidation of over $1.76 billion worth of cumulative leveraged long positions, with liquidations potentially reaching $1.87 billion if the price drops below $63,000, according to Coinglass data.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and analysis before making any investment decisions, as every investment and trading move carries risks.