The recent sharp decline in the cryptocurrency market led to an influx of $2.72 billion worth of Tether (USDT) onto centralized exchanges, making it the third-largest inflow of USDT into Ethereum to date.
This increase in Tether inflow coincided with Bitcoin (BTC) experiencing a significant drop to nearly $91,000, as concerns over a trade war caused turmoil in global markets.
Analysts believe that this unusually high movement of capital was driven by traders depositing additional collateral to cover margin calls and prevent liquidation. It also attracted opportunistic investors who took advantage of the market dip to accumulate Bitcoin.
“The substantial decline in the market triggered exceptional capital flows. Specifically, the net inflow of USDT to exchanges reached its third-highest level ever recorded, surpassing $2.72 billion.”
Following the sell-off, Bitcoin has recovered and is stabilizing within the $95,000 to $100,000 range. Stablecoins like Tether and its regulated counterpart USDC continue to play a crucial role in the cryptocurrency trading ecosystem by providing liquidity and facilitating swift asset purchases.
The recent influx of USDT highlights the vital function that stablecoins serve during times of market volatility. They act as a bridge for traders to quickly respond to price movements.
Whether the surge in Tether deposits indicates ongoing buying pressure or cautious repositioning remains to be seen as the market absorbs macroeconomic developments.
*This translation does not constitute investment advice.
