Stablecoin issuer Tether and several US spot Bitcoin ETFs (exchange-traded funds) have made significant Bitcoin (BTC) acquisitions. Indeed, the developments signal a potential demand shock.
Tether recently added 8,888 BTC to its reserves. Now, its total holdings stand at a staggering 66,465 BTC, valued at approximately $2.8 billion. Meanwhile, spot Bitcoin ETFs have reached a landmark by collectively holding 650,000 BTC.
Potential Bitcoin Demand Shock
Tether’s latest acquisition, marking its third-largest to date, is part of a strategic initiative that began in September 2022. Since then, the company has consistently increased its Bitcoin holdings each quarter
This strategy aligns with Tether’s shift in its reserve allocations, moving from traditional US government debt to crypto assets. Tether CEO Paolo Ardoino, affirming this strategy, that the company aims to allocate up to 15% of its quarterly profits to Bitcoin.
“The decision to invest in Bitcoin, the world’s first and largest cryptocurrency, is underpinned by its strength and potential as an investment asset. Bitcoin has continually proven its resilience and has emerged as a long-term store of value with substantial growth potential. Its limited supply, decentralized nature and widespread adoption have positioned Bitcoin as a favored choice among institutional and retail investors alike,” Ardoino said.
The significance of Tether’s increasing Bitcoin holdings is mirrored by the growing investment in BTC by spot Bitcoin ETFs. Thus far, since launch day, these ETFs collectively hold 650,000 BTC, indicating the growing institutional interest in Bitcoin
The actions of Tether and the spot Bitcoin ETFs underscore the rising acceptance of cryptocurrencies in mainstream finance and may herald a new phase in the evolution of Bitcoin.
