USDT Market Cap Plunge May Signal End of Bear-Market Selling Pressure

The Tether (USDT) stablecoin has lost $4 billion in market cap over the past two months, but according to CryptoQuant, the worst of this bear-market selling pressure may be nearing its end.

A recent analysis by CryptoQuant notes that USDT's 60-day rolling market-cap contraction is one of its heaviest drawdowns, with a $4.88 billion loss as of August 10th.

This downturn has echoes of previous crypto bear markets and rivals the largest ever seen, with implications for Bitcoin and the broader market recovery.

CryptoQuant analysts warn that while correlation between USDT flows and BTC price doesn't settle causality, periods of sustained USDT expansion have generally coincided with stronger Bitcoin price regimes, while prolonged contractions have accompanied weaker demand, deeper corrections, and deteriorating market conditions.