Bitcoin price remains trending in a very narrow range of $400 from the past 10 days.
The market capitalization of Tether(UDST) shot up with the BTC steep plunge recently
Some reports and research suggest that USDT and BTC are correlated.
Is Bitcoin Mutating Into Stablecoin?
After the drastic dip with the Bitcoin price in March 2020, the digital asset managed to recover in a very short span of time by attaining above $9000 within two months. But later it continued to oscillate in a very narrow price range.
In the above chart, the constant trend of the crypto can be easily determined. In the first phase, it trended in between $9100 and $9800 for three months. Later from $11100 to $11900 in the second phase. Currently, it has maintained its streak by trending in a narrow margin of just $400 from past 10 days recording $10410 at press time.
Therefore, many analysts are speculating the mutation of BTC to Stablecoin. However, many still believe in a major breakout for the digital asset in the coming days.
USDT Artificially Supports BTC
Tether(USDT) has managed to surround itself in many speculations and controversies from start. However, many of the researchers have come up with their report stating the correlation between the USDT and BTC price.
It is to be noted that, the USDT chart shows a steep increase in the market capitalization in a single day when the Bitcoin price had crossed $12000 for some time. Hence, an increase in the market cap resulting in the BTC pump cannot be ruled out.
Is Holding USDT Equivalent to Holding USD?
Is not any secret that the FED printed trillions of dollars to support the economy which crashed due to COVID-19. And on the other hand, USDT has been supporting BTC in terms of price from quite a long time. And the correlation between the stablecoin and the crypto has faced the water yet another time as USDT is looked upon as the digital representation of USD.
A crypto analyst CryptoWhale has also tweeted that Tether has supported BTC from 2014. And FED cannot be held responsible for the dip in the BTC price. He said that,
“You cannot criticize the Federal Reserve, then ignore the fact that the same thing is happening in crypto,”
Therefore, now when the Bitcoin hash rate has attained the highest level, the market capitalization of Tether is also gaining momentum. Collectively, it is tough to speculate whether the FED is behind the BTC pump and dump. As a large influx of USDT could possibly surge the BTC price.