- The movements of large investors holding major stable cryptocurrencies such as Tether (USDT) and USD Coin (USDC), like dolphins and sharks, could be important for the price of Bitcoin.
- The dolphins and sharks of the two largest stable cryptocurrencies in the industry have seen a significant horizontal movement in their combined supply in the past few weeks.
- In the near future, a decrease in the supply of major stable cryptocurrency holders could mean that these investors may be buying Bitcoin when the price is low.
According to research, the movements of whales holding stablecoins such as Tether (USDT) and USD Coin (USDC) can be decisive for Bitcoin.
Bitcoin Investors Should Pay Attention to This Metric
According to Santiment, the movements of large investors holding major stable cryptocurrencies such as Tether (USDT) and USD Coin (USDC), like dolphins and sharks, could be important for the price of Bitcoin. Typically, investors use these dollar-backed tokens when they want to avoid fluctuations associated with other assets in the market, such as BTC. However, owners who truly exit this space do so with fiat currency.
When these investors see favorable prices to return to other cryptocurrencies, they exchange their stable cryptocurrencies with them. This naturally creates buying pressure in the market they pass through and thus contributes to bullishness in the price of the asset. Currently, Santiment looked at data on the supply of relatively large stable cryptocurrency investor groups to check if there is a significant conversion from stable cryptocurrencies to Bitcoin and other assets.
More specifically, the combined ownership of dolphins and sharks was interesting here. These owners typically hold between 10,000 and 100,000 BTC in their balances. Here is a chart showing how the supply of these investor groups has changed for USDT and USDC over the past few months:
As shown in the above chart, the dolphins and sharks of the two largest stable cryptocurrencies in the industry have seen a significant horizontal movement in their combined supply in the past few weeks.
This means that these significant investors have not participated in any net conversion activity in recent times, meaning they have not converted Bitcoin into stablecoins or exchanged their stablecoins for other assets.
Bitcoin’s Drop to $29,000 Did Not Have an Effect
Interestingly, this horizontal trend has continued in the past few days despite the cryptocurrency dropping to levels around $29,000 during this period. Santiment said;
“Currently, one of our fundamental thoughts revolves around whether this behavioral pattern will continue in the next 24 hours, especially after today’s falling prices. Will these users see this change as an opportunity to ‘buy the dip’? Or will they abandon ship in the face of increasing market uncertainty?”
In the near future, a decrease in the supply of major stable cryptocurrency holders could mean that these investors may be buying Bitcoin when the price is low. However, on the other hand, an increase would clearly be a worrisome sign as it could mean that dolphins and sharks are starting to give up on BTC and exit from it.
