Here is How Stablecoins Could Spur Bitcoin Surge, According to Analyst

Markus Thielen from 10x Research suggests that a rise in stablecoin issuance might be crucial for Bitcoin’s next price surge.

In the past week, Tether and Circle issued nearly $2.8 billion in stablecoins, signaling that institutional investors may be adding new capital to the crypto market, according to Thielen. If this trend continues, Bitcoin could see additional price increases.

Since August 9, Bitcoin has fluctuated between $58,000 and $62,000, recovering from a drop to $55,000. However, breaking through the $60,000 to $61,000 resistance level might require more than just a lower Consumer Price Index (CPI), which is expected to be released on August 14.

Thielen emphasizes that a sustained rally will likely need strong stablecoin inflows, as these are critical for maintaining momentum. Without significant stablecoin investment, Bitcoin’s current rally might lose steam.

On August 13, Tether minted $1 billion worth of USDT, but this was primarily for inventory purposes, not immediate market issuance. Tether’s market cap has surged to a record $115.6 billion, while Circle’s USD Coin (USDC) circulation has grown to $34.5 billion, reflecting a 4.5% increase since early August.

Thielen also noted that Circle’s regulated status likely attracted institutional flows. However, he warns that without additional supportive factors like changes in the macroeconomic environment or Federal Reserve policies, Bitcoin may experience short-term sluggishness.