Tether’s onchain activity is buzzing, reaching a six-month high, hinting that traders might be gearing up for a market re-entry. This surge in activity was highlighted by Santiment, a blockchain data platform, which reported over 143,000 wallets making transfers on March 11. This spike suggests that traders are preparing to dive back into the crypto waters.
When stablecoin activity like USDT spikes during price drops, it’s often a sign that traders are loading up their digital arsenals, ready to pounce on buying opportunities. This added buy pressure can be a catalyst for crypto price recovery, according to Santiment.
The backdrop to this activity is Bitcoin’s recent tumble to a four-month low of $76,700 on March 11. The broader crypto market has been shedding gains amid macroeconomic uncertainties and an escalating tariff war. Vincent Liu, chief investment officer at Kronos Research, notes that traders often stockpile Tether during these dips, positioning themselves for strategic buys.
Liu speculates that the recent uptick in USDT wallet activity reflects traders capitalizing on market volatility. Factors like economic uncertainties, regulatory developments, and Tether’s role as a stable haven make it an attractive holding for investors ready to deploy capital strategically.
Despite the bullish signals from USDT activity, the crypto market’s recovery hinges on broader factors like macroeconomic conditions and regulatory clarity. With inflation easing to 2.8% in February, lower than expected CPI data could reduce pressure on crypto prices, signaling a more favorable environment.
Looking ahead, the upcoming Federal Open Market Committee (FOMC) meeting on March 18 could provide further insights into interest rates and monetary policy, potentially influencing market dynamics.
Meanwhile, the Crypto Fear & Greed Index hit its lowest score in over two years on February 26, slipping into “Extreme Fear” territory with a score of 10. Although sentiment has improved since then, the index still registered a score of 45 on March 13, indicating lingering fear.
In other news, Tether CEO Paolo Ardoino is touring the US as lawmakers move to regulate the sector. During a speech at the Cantor Fitzgerald Global Technology Conference on March 12, Ardoino noted that around 37% of USDT users use it as a savings account to store value. Many of these users lack traditional bank accounts and rely on USDT as a stable currency stored on their smartphones.
Ardoino emphasized Tether’s role as a stronghold for the US dollar amid concerns about its global dominance. The stablecoin issuer is also actively working to curb bad actors in the space, collaborating on over 170 law enforcement operations and freezing $2.5 billion in illicit funds.
As traders prepare for potential market moves and regulatory landscapes shift, all eyes are on Tether’s activity as a bellwether for crypto’s next chapter.
