Tether (USDT) Sharks & Whales Rapidly Accumulate, Why This Is Bullish For Bitcoin
Tether USDT and Bitcoin

Veliko Tarnovo, Bulgaria – May 16, 2022: Cryptocurrency Tether coins standing upright on top of US dollar banknotes,

On-chain data shows that Tether (USDT) sharks and whales have been rapidly increasing their holdings since Bitcoin volatility began.

Tether Sharks and Whales Increase Holdings as USDT Exchange Supply Plummets

According to data from on-chain analytics firm Santimentthese large Tether holders currently hold a combined total of $16 billion worth of stablecoins. The relevant metric here is “USDT supply distribution,” which shows how the Tether supply is currently distributed among the different holder groups in the market.

Investors or addresses are divided into these holder groups based on the total number of coins they currently hold. In the context of the current discussion, the main “Sharks” and “Whales” cohorts are of interest, and can be defined as having a total coin holding range of $100,000 to $10 million.

Naturally, this group of holders includes all addresses on the blockchain with at least $100,000 and up to $10 million worth of USDT in their balance.

Below is a graph showing the trend in shark and whale Tether supply distribution over the past six months.

Tethered Sharks and Whales

The value of the metric seems to have sharply gone up in recent days | Source: Santiment on Twitter

As shown in the chart above, the total supply of Tether addresses holding between $100,000 and $10 million has recently surged. Interestingly, this increase coincides with the high volatility that Bitcoin experienced after Binance was sued by the SEC for fraud.

Generally, investors use stablecoins like USDT whenever they want to get out of volatile coins like BTC, so when investors swap their assets for stablecoins, it could be a sign of a sell-off.

The recent surge in shark and whale supply could be due to huge holders abandoning cryptocurrencies such as Bitcoin during these uncertain times.

But typically, when holders choose stablecoins rather than withdrawing through fiat or other means, it means they may be hoping to eventually return to volatile markets.

When these investors eventually feel the price of the other coin is right, they will move their USDT into their desired asset, putting buying pressure on its price.

For this reason, the supply of a stablecoin can be seen as the available purchasing power of an asset like Bitcoin. As sharks and whales bought up Tether, driving its supply to a record high of $16 billion, the potential untapped funds in BTC also increased.

It remains to be seen when these huge holders will eventually return to the cryptocurrency, but if they do, its price is likely to see a bullish rally.

Data on Tether’s exchange supply (i.e. the amount in exchange wallets) has also been shown to be rising on the charts. This metric appears to be rising while sharks and whales are buying, suggesting that coins being dumped from these platforms are being picked up by these cohorts.

BTC Price

At the time of writing, Bitcoin is trading at around $26,600, down 2% since last week.

Bitcoin Price Chart

Looks like the value of the asset has been moving sideways recently | Source: BTCUSD on TradingView

Featured image from iStock.com, charts from TradingView.com and Santiment.net


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