Two substantial transactions involving 50 million Tether (USDT) each have been initiated, with the funds being transferred from Bitfinex to the “Tether Treasury” address. These transfers were detected through Whale Alert notifications.
Both of these transactions transpired on October 2, 2023, just two minutes apart. The first transfer of 50 million USDT was executed at 9:43 am UTC, amounting to $50,039,125. Shortly thereafter, at 9:45 a.m. UTC, the second transfer took place, totaling $50,038,875.
CryptoQuant’s data reveals a consistent decline in stablecoin reserves held on cryptocurrency exchanges over the past year, commencing around November 2022. Prior to this decrease, during the early stages of 2021, the crypto market witnessed a record-breaking influx of stablecoins like USDT into exchanges, marking an all-time high (ATH).
Stablecoin holdings on exchange reserves 2023. Source: CryptoQuant
In response to these significant transfers, the crypto community on platforms like X (formerly Twitter) has been buzzing with discussions, labeling them as a “pump.” This term refers to efforts to artificially boost the value of a stock or token to attract investors.
However, on September 29, market intelligence platform Santiment shared insights on market trends, noting that “Tether sharks and whales” are amassing purchasing power, a development viewed as generally bullish.
Cointelegraph’s analysis indicates that stablecoins have experienced a 17-month decline, as investors shift their focus toward more conventional assets. This trend coincides with the United States Federal Reserve’s concern, as it identified stablecoins as a potential “source of financial instability” on September 28. The report stated that stablecoins are susceptible to runs during periods of widespread cryptocurrency market turmoil and specific stress events.
Stablecoins have also been a prominent subject in legal disputes affecting the cryptocurrency industry. In the case of the U.S. Securities and Exchange Commission vs. Binance, the issuer of USD Coin (USDC), Circle, recently argued that stablecoins should not be classified as securities.
Interestingly, despite these debates and concerns, Tether has witnessed a surge in USDT-based stablecoin loans in 2023.