As Bitcoin is trading at $15,400, the figure of Fear and Greed Index has reached 88 on the chart. As the Fear and Greed Index is increasing, the volume of stablecoins, including Tether, has also decreased.
The Slump in Tether’s Market Cap
For the first time in the last 30 days, Tether is exchanging hands as low as $0.99 and the overall trade volume of USDT has plunged by almost 4%. The decreasing trade volume of Tether represents a decrease in market cap. It shows that people who are waiting for the right moment have exchanged USDT for Bitcoin that resulted in a loss of market capitalization on the part of Tether.
The current level of the Fear and Greed Index was witnessed last time in June 2019, which unveils that investors are gearing up for taking profit as 97% of addresses are in profit. As a result of profit intentions in the BTC markets, a correction in the price value is imminent.
Based on the on-chain data provided by CryptoQuant, the velocity of Bitcoin has been increasing. The rise in velocity is showing sell-side pressure is building up as the transactions towards prominent cryptocurrency exchanges have been increasing for a few days.
Bitcoin inflows towards top exchanges, such as Binance, show miners are willing to empty their BTC bags to cover up the operational costs of the mining process.
Due to expansion in transactions, the difficulty level of mining has increased. The difficulty level has continued to jump upward since October, which points towards high mining activity that pushed the operation costs high. If Bitcoin’s price value goes down, it could threaten miners, which are spending money in large amounts on mining operations.
As the new data shows 97% of BTC addresses are in profit, traders and investors may offload their capital on the crypto exchanges for high returns.
Stablecoins have a key role as most of the traders prefer Tether for having direct and fastest access to Bitcoin.
At press time, the primary cryptocurrency is trading at $15,384 after an increase of 2.65% over the day.