- Tether invested a large portion of its profits in BTC.
- However, BTC miners became skeptical.
After the collapse of the Silicon Valley Bank (SVB), Tether’s [USDT] biggest competitor, Circle [USDC], heavily hit. Due to the FUD caused by this, USDT could capture a large share of the market share in the stablecoins sector.
Is your wallet green? Check out the Bitcoin Profit Calculator
A win-win situation for BTC and USDT?
As the overall profits of Tether, its parent company, skyrocketed, much of this revenue was spent buying U.S. Treasury bills. However, there were other ways Tether invested. Much of their income was 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 acquired 52,670 BTC. If Tether continues to dominate the stablecoin market, there could be positive consequences for the price of BTC.
As Andrew Kang, CEO of Mechanism Capital, a crypto investment firm, mention that if Tether continues to buy BTC with their profits, it could undermine the selling pressure on BTC that would arise due to the interests of the US government.
Source: Tether
At the time of writing, the US government had seized large sums of Bitcoin which it plans to sell in four phases during the year.
The US government’s decision to sell these positions has led to huge amounts of FUD in the market, with many traders believing that this sell-off could drive the price of BTC down.
However, if Tether continues its bullish behavior, there is a possibility that the impact of the actions of the US government will be negated in the future.
HODLers keep calm
At the time of writing, there was not much selling pressure on Bitcoin, as addresses in earnings had plummeted and hit month-long lows. This indicated that many addresses that currently hold BTC had no great incentive to sell their holdings.
📉 #Bitcoin $BTC Number of addresses in profit (7d MA) just hit 1-month low of 31,167,820,077
View statistics:https://t.co/qLnvDYVzPt pic.twitter.com/zVTHt6mrKV
— glassnode alerts (@glassnodealerts) May 14, 2023
Read Bitcoin [BTC] Price forecast 2023-2024
While BTC addresses continued to HODL, Bitcoin miners did not exhibit the same behavior. According to Glassnode data, Bitcoin miner outflows increased. This behavior showed that many miners could face significant selling pressure and have sold their holdings.
There will be a negative impact on BTC if this miner behavior continues.
Source: Glassnode