Blockchain analytics firm Glassnode has revealed a strong negative correlation between Bitcoin’s price and USDt (USDT) activity over the past two years. Their analysis, based on data from December 2023 onward, shows that net outflows of USDT from exchanges coincided with price increases in BTC. 💰
Glassnode explains that during periods of market enthusiasm, investors tend to withdraw large sums of USDT (~$100-$200 million per day) to lock in profits. This was clearly evident at Bitcoin’s $126,000 peak in October, where net outflows reached over $220 million (30-day simple moving average), signaling a shift towards profit-taking.
Meanwhile, earlier research by Whale Alert revealed a clear correlation between Bitcoin and USDT. They noted that stablecoin issuers typically mint during bull runs for cryptocurrencies and burn during corrections. The two assets remain the top and third most valuable tokens in the market, with BTC worth roughly $1.8 trillion and USDT at $184 billion.
Stablecoin adoption is surging as U.S. regulatory frameworks advance. In July, the US government enacted the GENIUS Act to establish a legal framework for payment stablecoins. Tether CEO Paolo Ardoino stated that USDt will comply with the new rules, while also announcing the launch of a new GENIUS-compliant dollar-pegged stablecoin, USAT.
U.S. regulators are also exploring ways to stockpile Bitcoin as part of a national strategic reserve. President Trump signed an executive order in March directing the creation of a digital asset reserve.
Despite these developments, reports suggest that the government has yet to actively implement this plan, primarily relying on acquiring cryptocurrencies seized during criminal investigations.