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$ 120 million in Tether has been minted recently and this could greatly benefit Bitcoin (BTC)

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While the size of the Bitcoin community has shrunk in recent months, one part of the cryptocurrency industry has been steadily growing – the market capitalization of Tether's USDT, the leading stable currency in dollars.

The cryptocurrency, now the fourth largest by market capitalization, has been responding to a surge in demand in recent weeks, with the Twitter account Whale Alert tracking a series of transactions indicating that the USDT is in high demand.

Just today, on April 18, it was reported that another $ 120 million of the stablecoin was minted. According to analysts, that It could be important for Bitcoin and the rest of the cryptocurrency market in the future.

Bitcoin will benefit from Tether's growing market capitalization (USDT)

According to the data of the cryptocurrency analytics tracker Skew.com, the amount of USDT in circulation recently exceeded seven billion, or approximately 3.4% of the market cap of the entire cryptocurrency market by CoinMarketCap. This comes after a series of $ 120 million impressions, like the one mentioned above.

Analysts believe this trend is positive for the cryptocurrency market, and may actually explain much of Bitcoin's recovery from the March lows of $ 3,700 at the current price.

Charles Edwards, a digital asset manager, said in January that:

"The great changes in market capitalization Tether's have driven the price of Bitcoin in the last 1.5 years. ”

Before the nearly 50 percent collapse in November 2018 that saw Bitcoin drop from $ 6,000 to $ 3,150, the amount of USDT in circulation fell by hundreds of millions; Also, prior to most of the 2019 crypto rally, USDTs worth hundreds of millions were printed.

This makes sense from a fundamental point of view. Ryan Selkis of Messari explained that with existing stablecoins worth $ 3 billion on the exchanges, there is a good chance that cryptocurrencies will rise, especially Bitcoin, as the largest USDT market is BTC.

His Zhu, CIO and CEO and hedge fund Three Arrows Capital, summed up this narrative well when made the following appropriate comment in the first quarter of 2019, a time when there was a value of only 2 billion in stable dollar currencies:

"There is an estimated $ 2B in cash in crypto funds / holdcos. There is another $ 2B + minted in stablecoins, and another $ 2B minted in exchanges / silvergate / signature. Imagine thinking that we need new money for Bitcoin to reach $ 10k. ”

Negative views

Yes, growth in demand for the stablecoin seems optimistic, but some have suggested that much of the recent growth is not related to a growing propensity to buy Bitcoin, but rather related to macroeconomic trends.

More specifically, it has been suggested that due to the global shortage of dollars, while the USD has become difficult to come by, investors, even those who are not in the cryptocurrency space, are turning to the USDT to transact.

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