Authored by Stephen Katte via CoinTelegraph.com,
Onchain activity for Tether has hit a sixth-month high, possibly indicating traders are gearing up to jump back into the market, according to analysts.
Data shared by the blockchain data platform Santiment in a March 12 X post shows Tether’s onchain activity has been on the rise, peaking with over 143,000 wallets making transfers on March 11, the highest in six months.
Onchain activity for Tethers USDT has spiked, reaching a sixth-month high. Source: Santiment
It comes as Bitcoin dropped to a four-month low of $76,700 on March 11, as the wider crypto market shed even more of the gains made post-US election amid macroeconomic uncertainty and an escalating tariff war.
Speaking to Cointelegraph, Vincent Liu, chief investment officer at Kronos Research, said traders often accumulate Tether during dips to position themselves for buying opportunities, adding buy pressure that can help crypto prices recover.
He speculates the uptick in USDT wallet activity likely reflects traders capitalizing on recent market volatility.
Liu says the surge in USDT activity is a bullish indicator, suggesting significant buying power on the sidelines, but the crypto market’s recovery will likely depend on factors like macroeconomic conditions, regulatory clarity, investor confidence and the March 18 Federal Open Market Committee (FOMC) meeting.
Swyftx lead analyst Pav Hundal told Cointelegraph that a lot of leading market metrics, like M2, are trending to the upside, but he doesn’t expect a major bounce until the political economy loses its volatility.
Hundal says the “market looks ugly right now,” but it is back to October levels of USDT dominance, which preceded a pre-Christmas rally that saw Bitcoin reach $100,000 for the first time in history.
A key Bitcoin and crypto sentiment tracker, the Crypto Fear & Greed Index, hit its lowest score in over two years on Feb. 26 as it slipped deeper into “Extreme Fear,” reaching a score of 10.
The index represents the current emotions and sentiments toward the crypto market, with the highest score being 100 and the lowest 0. Source: alternative.me
Crypto sentiment has staged a recovery since, but the index has still registered a score of 45 on March 13, still in fear territory.
Tether CEO Paolo Ardoino touring the US
Meanwhile, Tether CEO Paolo Ardoino is currently on a tour of the US as lawmakers move to regulate the sector.
During a March 12 speech at the Cantor Fitzgerald Global Technology Conference, he said that as it stands, around 37% of USDT users are using it as a savings account to store value.
At the same time, Ardoino said, Tether is acting as one of the “last strongholds for the US dollar” amid growing concerns that the US dollar could lose dominance as the world’s reserve currency and a go-to for international transactions and commodity trades.
The stablecoin issuer has also been working to curb bad actors in the space, collaborating on more than 170 law enforcement operations and freezing $2.5 billion in illicit funds, according to Ardoino.