Introduction
"Last night, I dreamed USDT hit 3.5 yuan," a retail investor shared with Odaily Planet Daily. As Tether (the "Fed of Crypto") continues aggressive USDT issuance post-'3.12' crash, concerns mount over its sustainability. With 4.25 billion USDT printed since March, the stablecoin's negative premium now reveals deeper market dynamics—particularly Bitcoin’s pricing power migrating overseas.
Key Insights
1. Unprecedented USDT Issuance
- 57 batches issued since March 12, totaling 4.25 billion USDT (including authorized but unreleased).
- Market cap surged to $8.8 billion, ranking fourth globally behind BTC, ETH, and XRP.
- TRON network dominated issuance after April 23, signaling a strategic shift from Ethereum.
👉 Explore real-time USDT issuance data
2. Demand Drivers: Who Absorbs This Supply?
- Exchange inflows: 97.85% of April’s ERC-20 USDT flowed to Binance (78.9%) and Huobi.
- Cross-border use: Pandemic-driven needs for trade settlements, remittances, and capital flight (e.g., Iran mining farms holding USDT/BTC).
- OTC markets: Southeast Asia and Brazil increasingly adopt USDT for trade invoicing.
3. Negative Premium & Its Implications
- Current溢价率: -1.72% (6.98 CNY vs. 7.1028 USD/CNY).
- Cause: Oversupply from arbitrage loops where institutions buy BTC with USDT, swap to USD via Tether, and repeat.
- Effect: Retail investors convert USDT to BTC/fiat, while overseas "whales" accumulate (60K–70K BTC since March).
The Bigger Picture: Bitcoin’s Migration
Data Trends
- Exchange BTC reserves hit 2-year lows; Coinbase saw inflows while Asian exchanges dropped 10–60%.
- Addresses holding >1K BTC rose 2.24% (Beatle News), confirming institutional accumulation.
Market Sentiment Divide
- Global: Twitter optimism; institutions go long.
- China: Miners and platforms sell BTC, risking pricing power transfer. "We’re handing whales cheap筹码," laments industry veteran Yang Hao.
FAQs
Q1: Why does USDT’s negative premium matter?
It reflects imbalanced supply-demand and signals institutional arbitrage draining BTC from Asian markets.
Q2: Where did most newly issued USDT go?
Primarily to Binance/Huobi (78.9% to Binance in April), then to BTC purchases or cross-border payments.
Q3: How long might this negative premium last?
Analysts suggest prolonged duration due to structural oversupply and ongoing institutional strategies.
Q4: Are miners really selling BTC?
Yes. Reports indicate Chinese miners offloading holdings, contrasting with overseas accumulation.
👉 Learn how to hedge USDT risks
Conclusion
The USDT surplus underscores a pivotal shift: Bitcoin’s pricing power is moving toward offshore institutions. As Yang Hao urges, retaining domestic BTC holdings could safeguard pricing influence—but market vigilance remains critical.
Disclaimer: This analysis doesn’t constitute investment advice. Assess risks independently.