'How Can You Be Bearish?' Asks Bitcoin Trader as Tether Surpasses $12B

The market capitalization of Tether surpassed $12 billion as of Aug. 14, according to cryptocurrency market analytics firm Coinmetrics.

Tether has been the most widely-utilized stablecoin for several years, and it has seen exponential growth.

In January 2017, the total supply of Tether was hovering at around $10 million.

Since Tether is often used to hedge against major cryptocurrencies, an argument could be made that its supply represents capital waiting on the sidelines.

BTC/USD price vs. Tether market capitalization.

A digital asset manager, pinpointed the increasing supply of Tether as a catalyst for Bitcoin.

"How can you be bearish Bitcoin here? - Portnoy in Bitcoin - Fed investigating crypto dollar w MIT - Gold S/R flip - +26% Tether - 45% supply hasn't moved in >2yrs - Energy Value increasing > price - Mining profitable & price near Production Cost - Accumulation price structure."

While some analysts consider the expanding supply of Tether as an optimistic trend, others have expressed concerns towards the stablecoin.

"But despite Tether's issues and the introduction of new stablecoins, USDT remained dominant and continued to grow. Originally launched using the Omni protocol on the Bitcoin blockchain, by the beginning of 2018 Tether began to expand to other networks."

The confluence of various positive macro factors, including institutional adoption, the weakening of the U.S. dollar via the increasing expansion of the money supply, and rising Tether supply, has led the sentiment around Bitcoin to improve with some analysts predicting new highs for BTC before 2021.