- Tether and Strategy persist in acquiring Bitcoin in the hundreds of millions to billions.
- But the market price remains stagnant.
- Those transactions are already incorporated in the current pricing, according to Robert Le from Pitchbook.
It’s indicative of tough times when multi-billion dollar acquisitions fail to influence Bitcoin’s price.
Two major players in the crypto world—Tether and Michael Saylor’s Strategy—are significantly increasing their Bitcoin reserves. The outcome? A downward trend in prices.
Tether confirmed on Tuesday that it acquired $735 million worth of Bitcoin, while Strategy revealed on March 31 that it bought $1.9 billion. Robert Le, a senior analyst at VC research firm Pitchbook, noted that these purchases are “already priced in” as reported by DL News.
The optimism stemming from these firms is not surprising enough, Le mentioned: “But imagine if that was JPMorgan.”
Since implementing its Bitcoin treasury strategy, Michael Saylor’s company has become the largest institutional Bitcoin holder, boasting over $45 billion in Bitcoin assets.
Additionally, the firm possesses three-quarters of the Bitcoin held by corporations, according to Bitwise.
Tether has also been adopting a similar approach. On Tuesday, the firm revealed it acquired 8,888 Bitcoin in the first quarter.
Le added that it will require an unpredictable factor to disrupt the ongoing downtrend.
The acquisition of 22,048 Bitcoin by Strategy marks the fifth largest purchase since Saylor initiated his Bitcoin investment strategy in August 2020, as noted by analyst James Van Straten.
“Now, consider the current market conditions.”
Straten refers to a turbulent crypto landscape since the inauguration of US President Donald Trump. Since then, Bitcoin has fallen 25% from its peak of $108,000, with the broader crypto market experiencing a 20% decline.
This volatility isn’t just limited to crypto. Broader capital markets have faced significant fluctuations, with Tesla stock dropping nearly 50% since Elon Musk assumed the role of the head of the Department of Government Efficiency, or DOGE, on January 20.
Signals of Strength
Given the substantial nine and 10-figure acquisitions by Strategy and Tether, many are “curious why Bitcoin’s price hasn’t reacted more dramatically,” stated Matthew Mena, an analyst at investment firm 21Shares in his conversation with DL News.
He believes he has the answer.
“What we observe today is indicative of a maturing market.”
Mena highlighted several positive indicators, including high open interest—the number of outstanding Bitcoin contracts—on the CME Group derivatives exchange and a spike in implied volatility.
This indicates that investors are not anticipating a market crash.
Bitcoin exchange-traded funds experienced inflows of $200 million last week, following a substantial $750 million in inflows the previous week, as per Mena.
“Therefore, if the price isn’t surging despite these acquisitions, it doesn’t necessarily signal a problem; it may actually indicate strength,” he observed.
‘Liberation Day’
As market observers anticipate the enforcement of Trump’s widespread tariffs on April 2, dubbed “liberation day,” analysts are making their predictions.
Arthur Hayes, CIO of Maelstrom, predicts a rise in crypto prices, largely driven by Federal Reserve Chair Jerome Powell. He is projecting a price of $250,000 by year’s end.
Conversely, not everyone shares his optimism.
Quinn Thompson, CIO at Lekker Capital, questioned on X on March 30: “Has there been a single headline this weekend that’s positive for risk assets?”
Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Email him at psolimano@dlnews.com.
