The US bank crisis seems to be an eye-opener as the results appear to be more drastic compared to that of the 2008 crisis. Meanwhile, the risk markets like cryptos and stocks gained significant exposure and also benefitted equally. However, the current recovery of the markets has raised the speculations of the impending upswing and the rise in the accumulation of the stablecoins may be the prime factor.
As coinpedia reported earlier that the SEC may target stablecoins next as their use cases of them have swelled over time. Moreover, the fall of the banking system may make the authorities more vigilant, but it does not appear to be easy to crack upon stablecoins as they did on the other cryptos.
The stablecoin markets are spread out across the world and are worth more than $134 billion, while a small share may be circulating within the US. In recent times, the majority of the stablecoins had lost their peg from $1, however, most of them recovered fueled by the major stablecoins, USDT & USDC.
Tether minted 2 billion USDT and flooded into the market while, Binance, one of the largest exchanges converted $1 billion of its SAFU funds into TUSD and USDT. Hence indicating that the stablecoins are safe in the current volatile condition.
On the other hand, the USDT and TUSD whales have been constantly accumulating. The addresses holding 100K to 10 million USDT witnessed a massive spike from 13% to 15% in the past few days, while the addresses holding between 1 million and 10 million USDT increased from 20% to 22%.
In the case of TUSD, whales holding between 100K to 1 million witnessed a jump from 44 million to 50 million. Although, Bitcoin witnessed a spike of over $27,000, yet investors appear to be extremely cautious due to the shaky economic conditions.
If in case the US banks crisis countries, the bullish scenario may be invalidated. Alongside, the FED who are increasing the interest rate to control inflation may take stringent steps which may in turn impact the crypto space.
Written by: Sahana Vibhute
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