Markus Thielen, an analyst at 10x Research, has highlighted stablecoin issuance as a potential major catalyst for Bitcoin’s future price rally.
In a report released on August 13, Thielen noted that nearly $2.8 billion in stablecoins, equivalent to IDR 43.7 trillion, were issued by stablecoin providers such as Tether and Circle during the previous week. This indicates a fresh influx of capital into the crypto market, largely driven by institutional investors.
“If this trend in issuance (not just new stablecoin printing) continues, Bitcoin could see further gains,” Thielen wrote.
Stablecoins’ Crucial Role in Bitcoin’s Next Rally
According to Thielen, the current expectation of a decline in the U.S. Consumer Price Index (CPI) is not strong enough to push Bitcoin’s price through the resistance zone between $60,000 and $61,000.
Instead, Thielen believes that a sustained rise in Bitcoin’s price requires support from stablecoin purchases, and this momentum could fade if stablecoin inflows are weak.
So far, the market capitalization of major stablecoin issuers like Tether and Circle has seen significant growth, with Tether reaching a record market cap of $114.6 billion in the past week.
On the other hand, Circle’s market cap has also grown by about 4.5% since early August, with $34.5 billion in USDC now in circulation.
Thielen noted that Circle’s inflows are likely coming from U.S. financial institutions, given the company’s stronger ties with regulated entities.
In addition to stablecoin issuance, Thielen also predicts that a more accommodative interest rate policy from the U.S. Federal Reserve and the return of Donald Trump as the leading presidential candidate, replacing Kamala Harris in the polls, could be additional factors driving Bitcoin’s price upward.
As of this writing, Bitcoin’s price stands at $60,892, up about 3% in the last 24 hours.
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