A $2.5 billion influx into stablecoins is anticipated to potentially drive a significant increase in the price of bitcoin, as detailed in a new report by Markus Thielen, a market researcher at 10x Research.
bitcoin price surge is coming
In his latest research bitcoin-traders-speculate-potential-bullish-impact-25-billion-stablecoin-inflow” target=”_blank” rel=”nofollow”>noteThielen explains the critical importance of monitoring and analyzing crypto money flows, which provide crucial insights into market conditions that can accelerate or inhibit bitcoin price movements. “Traders are often blindsided by price declines and overlook the critical signals these flows offer. However, the reverse is also true; a sustained increase in money flows can drive higher prices, but many also overlook these indicators,” Thielen writes.
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The researcher explains that money flows can predict price movements in both directions. In April 2024, a price correction was signaled when “money flows in general largely stopped.” Thielen adds that “a resurgence of certain money flows helped push prices higher as markets approached lows. The critical factor was monitoring the sustainability of these flows, as rallies often lost momentum without continued support.”
The report highlights the most recent activities involving major stablecoin issuers. Thielen notes that last night, Tether minted $1 billion worth of USDT, categorizing this as an inventory buildup rather than immediate issuance into the market. This distinction is essential as it suggests a preparatory step for possible future market action rather than an immediate injection of liquidity.
Additionally, the researcher details an important observation regarding the recent issuances of Tether and Circle, which together amount to nearly $2.8 billion. Thielen interprets this as a strong indication that institutional investors are deploying new capital into the cryptocurrency market, which historically signals bullish conditions for bitcoin. “If this trend of issuance (not just minting) continues, bitcoin could see further gains,” Thielen comments.
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To further support Thielen's analysis, the on-chain analytics platform Lookonchain x.com/lookonchain/status/1823337536896590157″ target=”_blank” rel=”nofollow”>reported Yesterday via x: “Tether Treasury minted 1B USDT on ethereum 20 minutes ago. Over the past year, Tether Treasury minted a total of 32B USDT!”
Furthermore, Lookonchain may have found a reason for the large issuance of new stablecoins. The firm x.com/lookonchain/status/1823370426170609722″ target=”_blank” rel=”nofollow”>found that substantial amounts of USDT flowed into Cumberland. They commented: “In just 8 days, Cumberland has injected 1.04 billion USDT into the cryptocurrency market! An hour ago, Cumberland received 141.5 million USDT from Tether Treasury again and transferred them to major exchanges such as Kraken, OKX, Binance, and Coinbase.”
More bullish catalysts
Cryptocurrency analyst Miles Deutscher x.com/milesdeutscher/status/1823620205861351549″ target=”_blank” rel=”nofollow”>delivered Another reason to be bullish on bitcoin is through x. He noted that current market conditions resemble the multi-month consolidation of 2023, suggesting a possible end to this phase based on similar chart formations and a sharp decline in retail interest.
“This looks a lot like what happened in August and October last year. Retail interest is rapidly evaporating (YouTube views have plummeted over the past week). There is apathy among existing market participants. Lack of clear narratives (and #bitcoin price action also looks identical),” Deutscher said.
Charles Edwards, founder of Capriole Investments, added a macroeconomic perspective, pointing to the expansion of the global money supply as a historical factor behind bitcoin’s price surge. “The global money supply is increasing. Also, we just came out of a massive 4-year consolidation. What do you think this means for bitcoin?” he rhetorically posed, suggesting a bullish outlook based on this factor.
At the time of writing, btc was trading at $60,853.
Featured image created with DALL.E, chart from TradingView.com
