Over $300 million Tether (USDT) Burnt at Tron, is this a clear Sell Signal?

Tether USDT Coin Burning
Image Courtesy of PixaBay

Over $300 million Tether (USDT) Burnt at Tron, is this a clear Sell Signal?

Tether Limited, the company behind the dollar-linked stable coin Tether (USDT), has announced on Twitter that it has destroyed $300 million USDT.

The stable coin plays a crucial role, acting as a conduit for traders to get in and out of the crypto markets.

Tether Limited could be Cashing out

By burning $300 million, it appears as if the company is cashing out.

At the time of press, there are over $4.1 billion USDT in circulation.

Tether USDT Market Cap and Supply
Tether USDT Market Cap and Supply

Coincidentally, this surprise coin burning is when BTC prices are shaky, dropping considerably on the last trading day.

But it isn’t Bitcoin alone. The crypto market is weak and leading tokens have posted near double digit losses after posting impressive gains in the past two trading months.

Is this the end of Bitcoin and Crypto Rally?

Tether Limited decision has sparked fears of further down trend. Usually, when USDT prices are churned from the treasury, it is ideally supposed to be backed one to one with the USD—or any fiat currency or liquid assets.

The more the number of USDT in circulation, the more the confidence from investors, and the higher the likelihood that BTC will edge higher.

When there is the demand for crypto via channels as USDT, trading volumes soar and that consequently lifts prices.

The opposite, given the prevailing sentiment of the masses who are so used to Tether Limited printing money, could signal bears and the end of a three-month rally.

Going forward, this massive liquidation could be a signal of a cooling market and a profit taking as crypto assets drop from late Jan 2020 peaks.

Coin Burn is not a New Phenomenon

This redemption is nothing new in Tether Limited’s history.

Although the company has not satisfactorily convinced critics that every stablecoin is redeemable to a dollar because of the peg, it is common for Tether Limited—which has close ties with Bitfinex, to redeem and burn a huge amount of the stable coin.

However, as of now, it cannot be known for sure whether the exchange—Bitfinex, is cashing out, or whether the $300 million is a request from a collective pool for stable coin redemption.

Summary
Over $300 million Tether (USDT) Burnt at Tron, is this a clear Sell Signal?
Article Name
Over $300 million Tether (USDT) Burnt at Tron, is this a clear Sell Signal?
Description
Tether Limited, the company behind the dollar-linked stable coin Tether (USDT), has announced on Twitter that it has destroyed $300 million USDT.
Author
Publisher Name
CoinGape
Publisher Logo
Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.
Disclaimer The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Author: Dalmas Ngetich

Dalmas is a very active cryptocurrency content creator and highly regarded technical analyst. He’s passionate about blockchain technology and the futuristic potential of cryptocurrencies and enjoys the opportunity to help educate bitcoin enthusiasts through his writing insights and coin price chart analysis. Follow him at @dalmas_ngetich

Post your comment...
Dalmas Ngetich 226 Articles

Dalmas is a very active cryptocurrency content creator and highly regarded technical analyst. He’s passionate about blockchain technology and the futuristic potential of cryptocurrencies and enjoys the opportunity to help educate bitcoin enthusiasts through his writing insights and coin price chart analysis. Follow him at @dalmas_ngetich

Follow Dalmas @