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Wednesday Nov 26 2025 22:00
2 min
Blockchain analytics provider Glassnode has identified a "strong negative correlation" between Bitcoin (BTC) and USDt (USDT) activity over the past two years. A recent X post by Glassnode compared Bitcoin's price to net USDT flows to exchanges, beginning in December 2023, shedding light on this intriguing relationship.
The analysis reveals that net outflows of USDT from exchanges often coincide with increases in the price of Bitcoin. Glassnode notes that during periods of heightened market optimism, USDT typically experiences outflows ranging from -$100M to -$200M per day as investors capitalize on gains.
Specifically, at the peak of $126,000 in October, net USDT outflows surpassed $220 million (30-day Simple Moving Average), signaling substantial profit-taking activity. These outflows have since moderated, with flows trending back toward positive territory.
Whale Alert's April analysis corroborated this correlation, noting that Tether typically mints USDT during cryptocurrency bull markets and burns it during corrections. Bitcoin and USDT remain the largest and third-largest digital assets by market capitalization, with respective valuations of approximately $1.8 trillion and $184 billion.
The U.S. government passed the GENIUS Act in July, establishing a regulatory framework for payment stablecoins. Tether CEO Paolo Ardoino stated that USDT would adhere to the law and announced plans in September to launch USAT, a new GENIUS-compliant dollar-pegged stablecoin.
Furthermore, the U.S. government and numerous states are actively building Bitcoin reserves as part of a strategic initiative. In March, former U.S. President Donald Trump signed an executive order mandating the creation of a digital asset reserve. However, reports suggest that the plan, which heavily relies on stockpiling seized crypto, has yet to be implemented.
Risk Warning: This article is provided for informational purposes only and does not constitute investment advice, investment research, or a recommendation to trade. The views expressed are those of the author and do not necessarily reflect the position of Markets.com. When considering shares, indices, forex (foreign exchange), and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and may not be suitable for all investors. Leveraged products can result in capital loss. Past performance is not indicative of future results. Before trading, ensure you fully understand the risks involved and consider your investment objectives and level of experience. Cryptocurrency CFD trading restrictions may apply depending on jurisdiction.
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