The crypto market has witnessed a dramatic couple of weeks, leading to uncertainties about what the future holds for the digital asset sector. Crypto debunking in the United States that began with the closure of three top crypto-friendly banks – Silvergate, Signature, and Silicon Valley Bank (SVB)- caused a dip in crypto prices at the start of last week.
However, when the Consumer Price Index (CPI) data came in as expected on Tuesday, it triggered a mid-week rally in the crypto market, with Bitcoin flashing above $26,000 for the first time since June 2022. The big crypto then recoiled back to $24,000, which stayed for a few days.
One headline that caught the attention of crypto traders this week was the large stablecoin transfers over the last year. This raised concerns about the next move likely to be made by the whales, given the uncertainty that lingered in the market. Are we in a bull season or a trap?
According to data from Santiment, a market behavior and blockchain analytics firm, there has been an increase in large transfers of Tether’s USDT stablecoin over the last 12 months. The firm posted the following chart on Twitter, saying that eight transactions were valued at over $1 billion.
The second largest stablecoin USDC was unstable last weekend after admitting that over $3.3 billion of its reserves were locked in the now-defunct Silicon Valley Bank. This caused USDC to lose its dollar peg, reaching lows of $0.87 on March 11. The stablecoin has since regained its 1:1 dollar peg after the US government intervened to ensure that all bank depositors would have access to their funds.
Are Whales Behind The Ongoing Market Shift?
Some analysts argue that the massive transfers by the large stablecoin holders indicated that they were getting ready to place their long positions for Bitcoin. This has played out as expected, as the crypto market experiences volatility going into the weekend.
According to data from CoinMarketCap, Bitcoin has soared 10% over the last 24 hours to trade above $27,000; levels are last seen in mid-June of the previous year. At the time of writing, the big crypto was hovering around $27,380, and with a live market cap of $529 billion, its dominance had increased to 45.14%, a 0.33% rise on the day.
Ethereum, the largest altcoin by market capitalization, was up 6.06% on the day to reclaim the $1,800 level. Other top 10 non-stablecoin cryptocurrencies were also flashing green. Binance Coin, XRP, Cardano, and Dogecoin were up 3.94%, 3.97%, 6.38%, and 5.29%, respectively, over the last 24 hours. The biggest gainer among the top capped cryptos was Solana which posted 12.58% gains over the same time frame to trade at $22.52.
The global crypto market has risen by 5.4% on the day to stand at $1.17 trillion at the time of writing. This is a positive move for the crypto market as investors hope the ongoing recovery will be sustained and, hopefully, signal the start of a bull run.
Santiment said the rise in crypto prices could be attributed to multiple factors, such as an increase in spot-driven buying, network growth, and a decline in the dollar value. The data firm also expressed confidence that the breakout could be real “with # Bitcoin’s reintroduction to $30k looking more realistic.”
