Tether (USDT), the largest stablecoin in the world, has generated an additional $1 billion, pushing its market capitalization above $110 billion. This could potentially spark Bitcoin’s (BTC) rise to new all-time highs.
The Treasury of Tether has created $1 billion worth of USDT in the past 24 hours, bringing the total for the year to $31 billion. According to a post from Lookonchain on May 17, the newly minted USDT played a significant role in Bitcoin’s price surge from $27,000 to $73,000.
Tether also has the potential to directly contribute to Bitcoin’s rally. The company has stated 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 worth $618 million, making it the seventh-largest holder of Bitcoin in the world, according to Bitinfocharts. Currently, Tether’s wallet holds over 78,317 BTC worth over $5.18 billion, one year after announcing its plan to diversify into Bitcoin.
The price movement of Bitcoin is still heavily influenced by institutional inflows into spot Bitcoin exchange-traded funds (ETFs). The United States Bitcoin ETFs have seen 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. By February 15, Bitcoin ETFs accounted for approximately 75% of new investments in the 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 acting as a strong support for BTC, according to TradingView. Additionally, on the monthly chart, Bitcoin has turned its previous resistance into support, which is seen as a bullish sign by popular crypto analyst Rekt Capital.
However, there is still a possibility of a temporary correction for Bitcoin, with a potential drop below $63,500 before reclaiming the psychological level of $70,000. According to the AI-based predictions algorithm of ScorehoodAI, this correction could result in the liquidation of over $1.76 billion worth of leveraged long positions. Coinglass data suggests that liquidations could reach $1.87 billion if Bitcoin falls below the $63,000 mark.
It’s 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.