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Big Stablecoin Holders Do Not Believe in Rally and Stick to This Strategy

Thu, 08/04/2022 - 10:05
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Gamza Khanzadaev
Here is how stablecoin sharks' tactics correlate with crypto market
Big Stablecoin Holders Do Not Believe in Rally and Stick to This Strategy
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According to crypto analytics agency Santiment, relatively big stablecoin holders, referred to as sharks, are focused more on accumulating their positions than exiting USDC and USDT into Bitcoin, Ethereum or other cryptocurrencies.

Stablecoin sharks, whose behavior is taken as an object of research, are considered to be wallets holding between $10,000 and $100,000 in USDC or USDT.

According to Santiment, this group of investors is a kind of analog of the middle class on the crypto market: rich enough to be considered veterans of the market, but at the same time not too sophisticated with big funds. Their active accumulation of stablecoins in recent weeks is a marker of the desire to find stability in a rather depressed crypto market and reflects the rather bearish mood of this group of investors.

Stablecoins on the sidelines

Recently, more and more opinions and views have been swirling around the topic of stablecoin liquidity on the crypto market. Experts and prominent figures in the new digital economy have been actively commenting on the topic of the presence or absence of the stablecoin supply, its increase or decrease.

Most opinions agree that an increase in the supply of stablecoins is a good signal for the market, including if it is concentrated away from the market. These crypto dollars will act as "powder" for the market when the right moment comes, believes CZ, head of Binance. On the other hand, one should be wary of the situation in which a large supply of stablecoins will not meet buyers in the market, and then downside risks increase.

At the same time, as reported by U.Today, one of the largest stablecoin issuers, Tether, restarted minting USDT in billion-dollar volumes after a three-month break.

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About the author

Financial analyst, trader and crypto enthusiast.

Gamza graduated with a degree in finance and credit with a specialization in securities and financial derivatives. He then also completed a master's program in banking and asset management.

He wants to have a hand in covering economic and fintech topics, as well as educate more people about cryptocurrencies and blockchain.