Tether Onchain Activity Hits Six-Month High: Traders Prepare for Market Shift

Tether Onchain Activity- Tether’s Role in Crypto Recovery

Tether Onchain Activity– Tether’s onchain activity has surged to a six-month high, potentially signaling that traders are positioning themselves to re-enter the crypto market. On March 11, over 143,000 wallets made transfers, marking the highest level of activity in half a year, according to data from blockchain platform Santiment.

Santiment noted, “When USDT & other stablecoin activity spikes during price drops, traders are preparing to buy. Added buy pressure aids in crypto prices recovering.” This surge in Tether transfers coincides with a drop in Bitcoin’s price, which hit a four-month low of $76,700 on March 11. The broader crypto market experienced a dip, shedding gains made after the US elections due to economic uncertainties and ongoing global trade tensions.

Vincent Liu, CIO at Kronos Research, explained that traders often accumulate Tether during market dips to position themselves for potential buying opportunities. “The uptick in USDT wallet activity likely reflects traders capitalizing on recent market volatility,” Liu stated. He further noted that Tether serves as a stable haven for investors, especially during periods of economic uncertainty or regulatory shifts.

Market Sentiment and Macroeconomic Factors

Analysts are viewing this surge in Tether activity as a bullish sign, indicating a build-up of buying power on the sidelines. However, they caution that market recovery depends on several factors, including macroeconomic conditions, regulatory clarity, and the upcoming Federal Open Market Committee (FOMC) meeting on March 18. Swyftx lead analyst Pav Hundal pointed out that while key market metrics are showing upward trends, a significant rebound is unlikely until political and economic volatility subsides.

Tether CEO Paolo Ardoino highlighted that approximately 37% of USDT users are using it as a savings account, often because they lack traditional bank accounts. Ardoino also emphasized Tether’s role in maintaining US dollar dominance as a global reserve currency amid growing concerns about the dollar’s future position in international trade.

Tether has also been proactive in addressing illicit activities, freezing $2.5 billion in illicit funds through over 170 law enforcement collaborations.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.