Crypto analysts believe the recent increase in USDT on-chain activity, which has reached a six-month high, could be a sign that Tether traders are buying the dip and preparing for a market rebound.
According to data shared by the blockchain data platform Santiment in a March 12 X post, USDT on-chain activity has recently been surging. On March 11, over 143,000 active wallets conducted transfers, the highest recorded rate in the last six months.
Investors’ Attention Turns to Stablecoins
Specifically, experts at the social metrics and on-chain monitoring protocol believe the surge in USDT on-chain activity highlights a shift in investor dynamics as they are ready to pounce on looming opportunities. The cryptocurrency market has experienced a general price drop that has seen investors train their attention on the leading stablecoins, using the opportunity to wait for the chance when Bitcoin and other leading coins rebound. Writing on the X social media platform, a statement from Santiment said:
“Tether’s on-chain activity has been rapidly rising, with over 143K wallets making transfers yesterday alone (a 6-month high). When $USDT & other stablecoin activity spikes during price drops, traders prepare to buy.”
Buying Pressure Aids Market Recovery
Historically, the rise of buying pressure in the market has often played a significant role in the market’s recovery. This has mostly happened during sell-offs when stablecoins like USDC and USDT have come in handy. As such, there is a strong feeling that the increased USDT on-chain activity is the result of traders fearing potential dumps waiting to cash out and are, therefore, taking Tether as a trusted store of value asset. Should the sentiment flip, the traders will have the chance to take up profitable deals.
Commenting on the development, Tracy Jin, COO of crypto exchange MEXC, said:
“The market may witness an outflow of capital from risky assets, including Bitcoin and altcoins, consistent with the current bearish trend. Given the recent $3.5 billion outflow from Bitcoin ETFs, the stablecoins capitalization growth confirms that institutional investors are temporarily taking a pessimistic stance.”
Activity Similar to September 2024
At the moment, Bitcoin and all other leading altcoins are experiencing bearish sentiments amid a broad risk-off sentiment, with the USDT on-chain activity being the only one that’s seemingly soaring. The report from Santiment observes that the network growth and daily Tether active address count over the past seven days is similar to what was observed in mid-September 2024. On September 14, 2024, 53,767 new wallets were created in one day.
Conclusion
The surge of USDT on-chain activity in September 2024 aligned with the ideal time for users to buy just before the Bull Run, which saw Bitcoin rally to reach an all-time high of above $109,000 later in December 2024. Analysts are now wondering whether the current increase in USDT on-chain activity, where over 143,480 USDT wallets undertook transfers on March 11, 2025, could quickly point to a similar recurring scenario.
Frequently Asked Questions (FAQs)
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What does it mean to be on-chain in the world of crypto?
The term on-chain refers to blockchain transactions that exist on and have been verified by miners or validators. It could also imply that transactions have been recorded on the blockchain.
What is the significance of on-chain analysis?
On-chain analysis studies blockchain data to understand cryptocurrency networks and trends, which is crucial for informed decision-making.
What metrics do analysts use when conducting on-chain analysis?
Experts use metrics like exchange reserves, transaction volume, and more to benefit traders by providing insights into market behavior.
What kinds of factors can limit the accuracy of on-chain analysis?
The accuracy of on-chain analysis can be limited by incomplete data, data manipulation, and the failure to account for external factors. As a result, analysts usually complement it with other analyses for a holistic view.
Appendix: Glossary of Key Terms
USDT: USDT stands for Tether, a digital asset or stablecoin whose price is pegged to the value of the United States dollar (USD).
On-chain activity: on-chain transaction is when a blockchain’s leading network records and processes an activity or transfer.
Stablecoin: A type of cryptocurrency whose value is pegged to another asset, such as a fiat currency or gold, to maintain a stable price.
References
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