Tether

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$150 Million in newly printed Tether could cause the Bitcoin price to spike

$150 million in freshly minted Tether assets could see the price of Bitcoin surging in the coming weeks.

Tether

Flickr

The effect that Tether has on the cryptocurrency market, on the whole, should not be ignored. The fiat-backed stablecoin does not only act as a safety net when the market experiences downtrends and crashes but recent sentiment around Tether has had notable impacts on the price of BTC.

In the past, Tether’s tumultuous history has been at the epicentre of significant increases in the price of bitcoin as well as the value of other altcoins. This is since capital held in Tether assets tends to flow back into different cryptocurrencies.

Furthermore, the overall market capitalization also seems to act as a magnet for the price of BTC, with the price of the OG cryptocurrency almost always spiking whenever new Tether assets are entered into the crypto market.

Seeing as almost half a billion dollars worth of Tether assets has been added to the crypto market since May, we could very well be seeing a notable Bitcoin price surge in the coming weeks.

BTC’s Price Related To Tether Market Cap Increase?

Analysts believe that there is a correlation between Tether and the entire crypto market. Despite negative sentiment in the past year, Tether still remains the leading stablecoin, and it is currently the only stablecoin which is sitting pretty in the top ten cryptocurrency list.

Many traders will exchange their BTC assets and other altcoin assets such as ETC, XRP or LTC for Tether funds when they expect the prices to drop. As Tether’s value is tied at a 1:1 ratio to the US dollar, the value of the coin remains relatively stable, which of course prevents losses when holding the volatile assets.

In addition to this, the stablecoin has shown a strong correlation to Bitcoin in an exciting way. Whenever the Tether treasury mints new Tether coins, the price of Bitcoin spikes.

Could The Recent Tether Minting Lead To A Surge?

According to crypto analyst FilbFilb, this connection began before Bitcoin’s massive drop through $6,000, which brought the original crypto to its bear market low. Before this bear market low, Tether’s market ap also hit it’s lowest low since February 2018.

The last time that FilbFilb pointed out a previous Tether minting was back in April when the treasury minted an addition $300 million. This could very well have been the catalyst that saw the price of Bitcoin break free from the $6,000 resistance, making it surge to the $9,000 mark, where its currently consolidating below at $7928.16 at the time of press.

Since May, when BTC first broke the $8,000 mark, an addition $500 million in the stablecoin has been minted with $150 million of it printed as of yesterday.

These new Tether assets could ultimately lead to Bitcoin surging past the $10,000 mark or it might not. Tether is surrounded by much controversy these days in light of the loss of $850 million by its parent company Bitfinex. Only time will tell, but we like these odds.