Tether revealed that its net profit for 2025 declined by roughly $3 billion compared to the previous year, even as the company’s holdings of United States Treasury bills climbed to the highest level in its history.
Figures verified in a report prepared by accounting firm BDO showed the stablecoin issuer generated more than $10 billion in net profit during the year, down from the $13 billion it recorded in 2024.
Treasury allocation reflects focus on safety and liquidity
Direct exposure to U.S. Treasuries surpassed $122 billion, a level the company described as evidence of an ongoing shift toward highly liquid, low-risk assets within its reserve management strategy.
Total assets on the balance sheet increased by $49.17 billion year on year, reflecting expanding issuance and continued accumulation of reserves as the stablecoin ecosystem grew across international markets.
USDt issuance rises as demand for digital dollars accelerates
Over the past twelve months, the company issued approximately $50 billion worth of new USDt tokens as demand for digital dollars increased in regions where traditional banking systems remain slow or fragmented.
Tether chief executive Paolo Ardoino said the stablecoin’s adoption has expanded because of “global demand” for U.S. dollars increasingly moving outside conventional financial infrastructure.
“Particularly in regions where financial systems are slow, fragmented, or inaccessible,” he said, claiming that the stablecoin has “become the most widely adopted monetary social network in the history of humanity.”
Market attention remains fixed on Tether’s reserves
Market participants continue to monitor Tether’s disclosures closely because USDt represents a substantial share of liquidity used across exchanges, trading desks, and decentralised finance platforms worldwide.
USDt ranks as the third-largest cryptocurrency by market capitalisation behind Bitcoin and Ether, making its reported reserves an important indicator of confidence across the broader stablecoin market.
Traders frequently rely on USDt as a digital dollar substitute for collateral, settlement, and margin purposes, increasing the importance of reserve composition and overall profitability figures.
Gold exposure strengthens alongside dollar-backed reserves
Alongside Treasuries, Tether has steadily increased its exposure to gold, reporting approximately $12 billion in gold-related reserves as of September 2025.
The company holds 520,089 troy ounces of gold specifically backing its XAUt tokens, equivalent to roughly 16.2 metric tons, which are kept separate from its broader bullion holdings.
“Tether maintains approximately 130 metric tons of physical gold, and the gold backing every XAUT token is held separately, making it eligible for physical delivery redemption,” a spokesperson for Tether recently told Cointelegraph.
Broader physical gold reserves amount to about 130 metric tons, valued at nearly $22 billion at current market prices, adding another layer of perceived stability to its overall reserve structure.
Bitcoin showed sharp volatility on Wednesday after briefly rallying to $90,600 before losing momentum following the US Federal Reserve’s decision to leave interest rates unchanged.
The price reaction highlighted how sensitive crypto markets remain to macroeconomic signals, particularly those tied to monetary policy.
Although the rally faded quickly, traders are now focused on a higher price zone that could define Bitcoin’s next major move.
Market data suggests $93,500 has emerged as a critical level where billions of dollars in short positions are vulnerable to liquidation.
If Bitcoin approaches this area, forced buying could significantly accelerate price action.
This scenario would turn what appears to be a modest recovery into a fast-moving breakout.
Many traders view liquidation clusters as magnets that attract price due to the liquidity they provide.
The concentration of shorts near $93,500 makes it one of the most watched levels in the current market structure.
Why $93,500 Has Become a Key Target
Crypto trader Mark Cullen highlighted the importance of the $93,500 level on Bitcoin’s liquidation maps.
He described the zone as standing out clearly, calling it a “come get me” signal for traders.
According to Cullen, the size and visibility of the liquidation cluster make it difficult for the market to ignore.
Data shows more than $4.5 billion in cumulative short positions positioned around this price.
If Bitcoin trades into that region, many of these positions could be automatically closed.
Short liquidations force traders to buy Bitcoin to exit losing positions.
This buying pressure can quickly compound and push prices higher in a short period.
Such events often produce sudden, aggressive price spikes rather than slow upward movement.
Liquidation-driven rallies are common in markets dominated by leveraged trading.
Bitcoin’s derivatives market remains one of the most active in the global financial system.
The size of these positions suggests that even modest upward movement could create significant momentum.
Leverage Dominates While Spot Demand Lags
Despite the technical appeal of the $93,500 target, underlying market participation tells a more cautious story.
The Coinbase Bitcoin premium index remains firmly negative.
This indicates weaker demand from US-based spot investors.
A negative premium usually means Bitcoin is trading cheaper on Coinbase compared to offshore exchanges.
That gap suggests US institutional and retail buyers are not aggressively accumulating.
Instead, futures markets appear to be driving most of the recent volatility.
Futures trading relies heavily on leverage, which increases both potential gains and risks.
When price moves against leveraged positions, forced liquidations occur rapidly.
This structure makes rallies more explosive but also more fragile.
Without spot demand backing price increases, gains can reverse just as quickly.
Sustainable bull markets typically require strong participation from spot buyers.
At present, that component appears weak.
Risk-Off Signals Continue to Flash
Crypto analyst Leo Ruga highlighted that broader market indicators still reflect caution.
He pointed to the composite risk oscillator, which compares Bitcoin with assets like stocks, gold, oil, and the dollar.
The oscillator remains in what he described as risk-off territory.
Its current reading near 52 suggests stress rather than expansion.
Ruga also noted elevated readings in the on-chain pressure oscillator.
This metric tracks selling pressure from large holders and long-term investors.
Levels above 34 have historically coincided with market distribution phases.
These signals imply that sellers may still have influence.
For a sustainable recovery, selling pressure must diminish significantly.
Until that happens, bullish momentum may struggle to persist.
Short-term pumps remain possible, but they lack confirmation from broader indicators.
Whale Activity Remains Neutral
Analyst Pelin Ay focused on Bitcoin’s Whale Ratio as another important signal.
The Whale Ratio tracks the proportion of large transactions flowing into exchanges.
High readings often suggest whales are preparing to sell.
Low readings suggest accumulation or holding behavior.
Currently, the ratio sits near its 100-day moving average.
This position signals neutrality rather than conviction.
Whales are not aggressively selling, which limits downside risk.
However, they are also not accumulating aggressively, which limits upside momentum.
Strong bull trends usually emerge when whales actively accumulate.
The absence of that behavior suggests hesitation among large market participants.
This neutral stance contributes to choppy and unpredictable price movement.
Volatility may continue without a clear directional bias.
What Comes Next for Bitcoin
Bitcoin’s structure shows tension between liquidation-driven upside and weak underlying demand.
The $93,500 level remains a powerful magnet due to the massive short exposure clustered there.
If price moves higher, liquidations could push Bitcoin rapidly toward that zone.
However, without strong spot buying, such a rally may lack staying power.
Risk-off indicators and neutral whale behavior suggest caution is still warranted.
Bitcoin may continue moving in sharp, volatile swings rather than a smooth trend.
Traders will closely monitor whether price action becomes supported by spot market participation.
Until then, Bitcoin remains driven by leverage rather than conviction.
Morgan Stanley has appointed veteran executive Amy Oldenburg to lead its newly established crypto unit as the bank accelerates its push into digital assets.
The move comes only weeks after the investment bank revealed plans to launch three crypto exchange-traded funds and introduce a crypto wallet for its clients.
This marks one of the firm’s most decisive steps into the crypto space after years of cautious engagement.
Oldenburg will transition into the role of head of digital asset strategy after more than two decades with Morgan Stanley’s emerging markets equity team.
She has been with the bank since 2001 and has played a central role in shaping its approach to developing markets and new financial products.
Her appointment signals that Morgan Stanley is taking a long-term and structured approach to building its digital asset operations.
A Leadership Shift with Strategic Intent
Oldenburg has led the emerging markets team since November 2021, where she was responsible for driving the division’s digital asset strategy.
Her experience in navigating volatile markets and complex financial products is expected to be instrumental as Morgan Stanley deepens its crypto exposure.
The transition highlights how digital assets are no longer seen as a side project but as a core part of the bank’s future strategy.
By placing a seasoned executive at the helm, Morgan Stanley is aiming to blend traditional financial discipline with emerging technology innovation.
This approach could help reassure clients who remain cautious about crypto while still capturing new growth opportunities.
It also reflects growing competition among major financial institutions to position themselves as leaders in digital finance.
Expanding the Crypto Workforce
Job postings indicate that Morgan Stanley is actively growing its digital asset team.
The bank is recruiting for roles such as digital assets strategy director, digital assets strategist, and digital assets product lead.
These positions suggest that the firm is building a comprehensive structure covering research, product development, and client strategy.
Such hiring activity shows that the crypto unit is being designed as a permanent fixture rather than a temporary experiment.
It also signals confidence that client demand for digital assets will continue to rise.
The expansion supports the idea that Morgan Stanley is preparing for a broader adoption of crypto-related services across its business.
New Crypto ETFs and Market Impact
Morgan Stanley recently filed to launch spot Bitcoin and Solana exchange-traded funds.
These filings represent the firm’s first major entry into crypto ETFs after largely staying on the sidelines during the earlier wave of institutional adoption.
Later, the bank also filed for a staked Ether ETF that would hold ETH while staking an undisclosed portion to earn additional income.
If approved, these products could open the door to significant new inflows into BTC, ETH, and SOL.
Morgan Stanley serves around 19 million clients through its wealth management division, giving it enormous distribution potential.
This reach could make its crypto offerings highly influential in shaping market demand.
Building a Crypto Wallet and Tokenized Assets
Beyond ETFs, Morgan Stanley is planning to launch a crypto wallet that supports both cryptocurrencies and tokenized real-world assets.
These assets may include stocks, bonds, and real estate represented in digital form on blockchains.
Such a platform would position the bank at the center of the growing trend toward asset tokenization.
It would also give clients more flexibility in managing and transferring both traditional and digital investments.
The move reflects a broader shift toward integrating blockchain technology into mainstream finance.
Oldenburg’s Stance on Self-Custody
Oldenburg has consistently emphasized the importance of crypto self-custody.
She has spoken publicly about the principle of “Not your keys, not your coins” and the need for stronger infrastructure that allows individuals to control their own assets.
“I want my liquidity 24/7, and also we have clients that want to move assets that they have and potentially bank them with us and be able to leverage all of the features that the digital assets space allows you,” Oldenburg said at the Digital Assets Summit 2025.
She previously expressed skepticism toward ETFs because they did not support staking and direct asset utility.
However, regulatory attitudes have since shifted toward greater openness to more advanced crypto products.
This change may align better with her vision of a more functional and user-controlled digital financial system.
Binance co-founder Changpeng Zhao has firmly ruled out any return to the crypto exchange, even after receiving a presidential pardon that removed the legal barriers preventing him from doing so.
Zhao said the pardon issued by US President Donald Trump lifted all previous restrictions that had stopped him from holding a position at the company.
Despite that, he made it clear that returning to Binance was never part of his future plans.
“I haven’t really needed to go back. I didn’t really want to. I thought it was a pretty good way for me to step down, away from Binance after seven years,” he said.
Zhao explained that while the separation from the company was painful at the time, it eventually became something he accepted.
“At the time, it was very painful. I didn’t like it. But after, you get used to it. I don’t think it’s good for me to go back. I think we should leave room for other strong leaders to grow,” Zhao added.
His comments reflected a broader view that leadership transitions should be respected rather than reversed.
Zhao pleaded guilty in November 2023 to failing to maintain an effective Anti–Money Laundering program at Binance.
He was later sentenced to four months in prison and barred from working at the exchange.
Trump’s decision to pardon Zhao in October sparked controversy among US lawmakers.
Some questioned Binance’s alleged connections to Trump-linked crypto ventures.
Trump denied knowing who Zhao was when asked about the decision.
Zhao has consistently maintained that Binance has flourished since his departure.
He described the company as stable and progressing under its new leadership.
“Two capable CEOs” are now guiding the exchange forward, according to Zhao.
He said Binance had experienced growth across several important metrics.
These included increases in users, trading volume, and overall market share.
In a December open letter, Binance executives revealed the platform had surpassed 300 million users.
The company also reported total annual trading volume of $34 trillion.
Zhao described himself as a passive shareholder rather than an active executive.
“I just thought, look; they don’t need a backseat driver today. I’m still a shareholder,” Zhao said.
He added that his involvement was limited to offering advice through social media.
“I’m just a pretty passive shareholder, and today when I want to give them advice, I just write it on Twitter,” he said.
Zhao’s withdrawal from daily operations has allowed him to focus on broader crypto industry trends.
One of his most notable predictions involves Bitcoin’s future market behavior.
He believes the traditional four-year Bitcoin cycle could be nearing its end.
Bitcoin has historically followed a pattern of sharp rises followed by steep corrections.
This pattern has repeated roughly every four years since its creation.
Zhao suggested that a new market environment may disrupt that structure.
“Normally, Bitcoin follows four-year cycles, if you look at historic data every four years there’s an all-time high, and then there’s a drop,” Zhao explained.
“But I think this year, given the US being so pro crypto and every other country is kind of following, I do think we will see this; we will probably break the four-year cycle,” he added.
He believes Bitcoin could be entering what economists describe as a super cycle.
A super cycle represents a prolonged period of exceptional growth driven by strong fundamentals.
Such cycles often mark structural changes in markets rather than temporary rallies.
Zhao sees growing institutional adoption as a key driver of this potential shift.
He also pointed to regulatory clarity in the United States as a major catalyst.
The approval of Bitcoin ETFs has accelerated mainstream acceptance of digital assets.
Institutional capital is now flowing into crypto at unprecedented levels.
This has changed Bitcoin’s role from speculative asset to financial infrastructure.
Zhao said government support could transform crypto from a niche market into a global standard.
He suggested that international governments are closely watching US policy direction.
Many countries are now adjusting their regulatory frameworks accordingly.
Despite recent market weakness, Zhao remains optimistic about Bitcoin’s long-term outlook.
Crypto prices and sentiment have dipped at the start of the year.
Zhao described the downturn as temporary rather than structural.
He believes the foundations of the industry are stronger than ever.
Bitcoin’s supply structure and growing demand form a powerful economic equation.
The limited supply of Bitcoin makes it uniquely positioned in an inflationary environment.
Zhao said these conditions could support sustained upward price movement.
If a super cycle does emerge, it would mark a historic turning point for crypto markets.
It would reshape how investors interpret Bitcoin price behavior.
The traditional boom-and-bust model may no longer apply.
Zhao’s views reflect growing confidence among crypto industry leaders.
While he has stepped away from Binance leadership, his influence remains significant.
His commentary continues to shape market sentiment and long-term strategy discussions.
Zhao’s departure from Binance now appears final and deliberate.
He has positioned himself as a strategic observer rather than an executive decision-maker.
The industry, he believes, is stronger when leadership evolves naturally.
His focus has shifted from building exchanges to shaping ideas.
Bitcoin’s future, in Zhao’s view, is only just beginning.
Bitcoin is trading around $95,000, representing a gain of roughly 9.5% compared with its Jan. 1 opening price near $87,500.
Market participants broadly agree that the short-term trend remains constructive as the asset consolidates just below a major resistance zone.
Analysts describe the current phase as an inflection point, where a decisive move could define Bitcoin’s next major trend.
The level drawing the most attention is near $98,000, which aligns with the short-term holder cost basis.
This area has not seen a strong retest recently, making it a key hurdle for bullish continuation.
Glassnode analyst Chris Beamish said Bitcoin is approaching a “key inflexion point” as it challenges this level.
“Reclaiming the STH cost basis would signal that recent buyers are back in profit, typically a prerequisite for momentum to re-accelerate,” he said.
Trend Structure Still Favors The Bulls
Several market observers argue that Bitcoin’s broader structure remains intact despite recent consolidation.
MN Capital founder Michael van de Poppe said the trend remains upward as long as Bitcoin holds above its 21-day moving average near $91,200.
He added that a move above $100,000 would be a matter of time if this support continues to hold.
On a higher timeframe, analyst Mags pointed to Bitcoin bouncing from a multi-year trendline that has remained intact since March 2023.
“Bitcoin is bouncing from the long-term trendline support it has been holding since March 2023,” Mags said.
“Each time the price has bounced from this support, we have witnessed a strong run-up.”
The last bounce from this trendline in October 2023 preceded a rally of more than 170% to a record high near $73,800.
Technical Patterns Signal Potential Upside
From a charting perspective, Bitcoin is currently trading within an ascending triangle formation on the daily timeframe, as noted by newbettingsites.uk.
The pattern suggests growing buying pressure as higher lows compress against horizontal resistance.
A resistance zone between roughly $96,000 and $99,500, defined by the 100-day and 200-day exponential moving averages, remains the key barrier.
A clean break above this region could open the path toward the pattern’s measured target near $113,200.
Analyst Matthew Hyland described the setup as an ascending triangle with confirmed hidden bullish divergence on the weekly timeframe.
“Price goes up,” Hyland said, summarizing the outlook.
Momentum Indicators Support Further Gains
Momentum indicators also lean bullish, though they suggest room remains before conditions become overheated.
The relative strength index has climbed to 64, recovering sharply from oversold territory seen in mid-November.
Daan Crypto Trades said this indicates Bitcoin is trading strongly without being overbought in the short term.
“There’s definitely a good amount of room to move higher for now,” he said.
Traders note that maintaining bullish market structure on lower timeframes remains essential for follow-through.
If those conditions hold, many expect Bitcoin to challenge six-figure territory in the weeks ahead.
Cumulative BTC ETF Inflows
Total Bitcoin ETF inflows have become a key metric for tracking institutional demand for Bitcoin, offering insight into how traditional investors are allocating capital to digital assets.
Since the approval of spot Bitcoin ETFs, cumulative inflows have grown steadily, reflecting sustained interest from asset managers, hedge funds, and long-term investors seeking regulated exposure to BTC.
Periods of strong inflows often coincide with broader market optimism, rising Bitcoin prices, or expectations of looser monetary policy. Large daily and weekly inflow figures suggest that ETFs are increasingly being used as a primary entry point for institutional capital, replacing more complex custody and direct ownership models.
At the same time, temporary outflows tend to appear during price corrections or heightened macroeconomic uncertainty, highlighting the sensitivity of ETF demand to market sentiment.
Over time, total inflows have reached substantial levels, reinforcing the view that Bitcoin ETFs are no longer a short-term trend but a structural part of the crypto market.
The dominance of a handful of major funds has also concentrated liquidity, improving price discovery and reducing volatility compared to earlier market cycles.
As adoption deepens, total BTC ETF inflows are widely seen as a long-term indicator of Bitcoin’s integration into traditional financial markets rather than a purely speculative asset.
Michael Saylor’s Strategy, the largest public Bitcoin holder globally, has increased its holdings past 700,000 BTC following a major purchase.
The company acquired 22,305 Bitcoin for $2.13 billion last week, according to filings with the US Securities and Exchange Commission.
The purchase price averaged $95,284 per BTC, with Bitcoin briefly climbing above $97,000 midweek.
This acquisition pushed Strategy’s total Bitcoin holdings to 709,715 BTC, purchased at a total of around $53.92 billion with an average cost of $75,979 per coin.
Largest Purchase Since February 2025
The latest purchase marks the company’s largest single acquisition since February 2025, when it bought 20,356 BTC for approximately $2 billion.
Earlier this month, on January 12, Strategy announced a smaller purchase of 13,627 BTC worth $1.3 billion, which had been its biggest acquisition since July of the previous year.
The acceleration in Bitcoin buying highlights Strategy’s ongoing commitment to expanding its digital treasury holdings.
Market Impact
Strategy’s stock (MSTR) experienced gains alongside Bitcoin’s recent price movement, rising past $185 amid a multi-month high for the cryptocurrency.
The momentum followed a decision by Morgan Stanley Capital International not to exclude digital treasury companies from its market index in early January, adding further investor confidence.
With Strategy continuing its accumulation strategy, market observers are watching closely for potential ripple effects on Bitcoin’s broader market sentiment.
This latest acquisition reinforces the company’s status as the world’s largest institutional Bitcoin holder and signals its long-term conviction in the asset class.
The White House is considering withdrawing its support for a major crypto market structure bill following Coinbase’s decision to step back from the legislation.
According to a source familiar with internal discussions, administration officials were caught off guard by the exchange’s move and view it as a serious breach of trust.
The draft legislation, known as the Digital Asset Market Clarity Act, was previously seen as a cornerstone of the administration’s crypto policy agenda.
Tensions Between Administration And Coinbase
The situation escalated after Coinbase publicly announced it could not support the current version of the bill.
Officials described the decision as a “unilateral” action that blindsided the White House and broader industry stakeholders.
One source characterized the move as a “rug pull,” arguing it undermined ongoing negotiations and momentum behind the legislation.
The same source suggested the administration could abandon the bill entirely unless Coinbase returns to talks and agrees to compromise.
“This is President Trump’s bill at the end of the day, not Brian Armstrong’s,” the source said, underscoring the growing rift.
Coinbase Raises DeFi And Stablecoin Concerns
Coinbase CEO Brian Armstrong defended the decision, arguing the draft bill would do more harm than good in its current form.
“We’d rather have no bill than a bad bill. Hopefully we can all get to a better draft,” Armstrong said earlier this week.
He pointed to provisions that he believes amount to a de facto ban on tokenized equities and impose sweeping restrictions on decentralized finance.
Armstrong also criticized expanded government access to financial records, warning it could erode user privacy protections.
Another key concern involves regulatory balance, with Armstrong arguing the proposal weakens the Commodity Futures Trading Commission while concentrating authority at the Securities and Exchange Commission.
The SEC has faced sustained criticism from the crypto industry for its enforcement-heavy approach in recent years.
Stablecoins At The Center Of The Dispute
Stablecoins have emerged as a major flashpoint in the debate.
Armstrong warned that the bill risks “killing rewards” on stablecoins, echoing industry fears that banking interests are shaping the legislation.
Banking groups have argued that stablecoin yields of around 5% could draw deposits away from traditional savings accounts.
Crypto advocates counter that these concerns are overstated and designed to limit competition rather than protect consumers.
Industry Reaction Remains Split
The broader crypto community remains divided over Coinbase’s stance.
Many users praised the exchange for pushing back against what they view as overreach by lawmakers and banks.
“Then the banks should stop trying to screw everyone over,” Coin Metrics cofounder Nic Carter wrote in support of Coinbase’s position.
Others criticized the company for exerting outsized influence over legislation that affects the entire industry.
“Coinbase is not crypto. Coinbase is one exchange in crypto,” one user commented, reflecting frustration with the power dynamics at play.
As negotiations stall, the future of the market structure bill remains uncertain, with political tensions now threatening to derail months of policy work.
Bitcoin has traded firmly above its opening price for the year, gaining roughly 9.5% and consolidating near the $95,000 level as traders assess its next directional move.
Market participants increasingly view the short-term trend as positive, with price action approaching a key technical barrier closely watched by analysts.
Focus Turns To Short-Term Holder Cost Basis
Bitcoin’s ability to reclaim six-figure territory depends on overcoming resistance near $98,000, which aligns with the short-term holder cost basis.
This level represents the average acquisition price of recent buyers and is often viewed as a threshold for renewed upside momentum.
“$BTC is approaching a key inflexion point,” said Glassnode analyst Chris Beamish in a Friday post on X.
“Reclaiming the STH cost basis would signal that recent buyers are back in profit, typically a prerequisite for momentum to re-accelerate,” he added.
Analysts See Broader Trend Support
MN Capital founder Michael van de Poppe said the broader trend remains constructive as long as Bitcoin holds above its 21-day moving average near $91,200.
He said maintaining that level would likely set the stage for an eventual move beyond $100,000.
Another analyst known as Mags highlighted Bitcoin’s bounce from a long-term trendline that has held since March 2023.
“Bitcoin is bouncing from the long-term trendline support it has been holding since March 2023,” Mags said.
“Each time the price has bounced from this support, we have witnessed a strong run-up,” the analyst added.
Historical Context Strengthens Bullish Case
The last significant bounce from this trendline occurred in October 2023, preceding a 172% rally that carried Bitcoin to a previous record high in March 2024.
That historical performance has strengthened expectations that the current consolidation phase could resolve to the upside.
Analysts also point to whale accumulation, steady institutional demand, and improving onchain metrics as supportive factors.
Ascending Triangle Points Higher
From a chart perspective, Bitcoin is retesting the upper boundary of an ascending triangle formation on the daily timeframe.
Resistance remains concentrated between $96,000 and $99,500, corresponding to the 100-day and 200-day exponential moving averages.
A confirmed breakout would imply a measured move toward roughly $113,200, based on the height of the pattern.
“Bitcoin is consolidating in an ascending triangle along with confirmed weekly hidden bullish divergence,” said analyst Matthew Hyland.
“Price goes up,” he added.
Momentum Indicators Remain Constructive
The relative strength index has climbed to 64 after emerging from oversold conditions late last year, suggesting strengthening momentum without immediate overheating risks.
“There’s definitely a good amount of room to move higher for now,” said analyst Daan Crypto Trades.
“Just need the bulls to hold the lower timeframe bullish market structures,” he added.
Bank of America CEO Brian Moynihan has warned that stablecoins could redirect trillions of dollars away from the US banking system, highlighting tensions between traditional banks and the digital asset sector.
Speaking during the bank’s Wednesday earnings call, Moynihan said up to $6 trillion in deposits, around 30% to 35% of all US commercial bank deposits, could shift to stablecoins under certain regulatory scenarios.
Moynihan noted that this estimate is based on Treasury Department studies and linked the potential outflow to ongoing debates over interest-bearing stablecoins.
Banks argue that yield-bearing stablecoins resemble bank deposits but lack the regulatory protections of traditional banking products, creating the risk of accelerated deposit outflows.
“Many stablecoin models resemble money market mutual funds rather than traditional deposits,” Moynihan said.
Reserves for these stablecoins are typically held in short-term instruments such as U.S. Treasurys, rather than being recycled into loans for households and businesses.
“If you take out deposits, they’re either not going to be able to loan or they’re going to have to get wholesale funding,” he added.
This alternative funding often comes at a higher cost for banks, potentially limiting lending capacity.
Lawmakers are currently debating legislation to limit passive yield on stablecoins while allowing activity-based rewards for staking, liquidity provision, or collateral posting.
The draft bill released by Senate Banking Committee Chair Tim Scott in early January drew more than 70 amendments ahead of a planned markup, reflecting intense lobbying by both banks and crypto firms.
Galaxy Research has raised concerns the bill could expand Treasury Department oversight of digital asset transactions.
Meanwhile, Coinbase CEO Brian Armstrong stated the exchange cannot support the bill as drafted, arguing that certain provisions would eliminate stablecoin rewards.
Scott later postponed the markup, saying negotiations are ongoing and all parties remain engaged in discussions to find common ground.
Bitcoin moved toward one-week highs at the start of Tuesday’s Wall Street session as markets reacted positively to lower-than-expected US inflation data.
The largest cryptocurrency gained around 1.5% as December Consumer Price Index figures came in largely in line with forecasts.
Headline CPI matched expectations at 2.7%, while core CPI printed at 2.6%, slightly below anticipated levels.
US equity markets responded immediately, with the S&P 500 pushing to fresh record highs.
Traders pointed to improving inflation conditions as supportive for risk assets, including cryptocurrencies.
Market observers also highlighted the growing tension between President Donald Trump and Federal Reserve Chair Jerome Powell.
The Federal Reserve is widely expected to keep interest rates unchanged at its January meeting.
Trump has continued to publicly pressure the Fed to cut rates further, arguing that lower borrowing costs would boost economic growth.
Following the CPI release, Trump renewed calls for rate cuts, a move that could increase liquidity flowing into crypto markets.
He also suggested US trade tariffs have helped cool inflation, an issue currently facing legal scrutiny.
Traders Warn Of Heavy Resistance Ahead
As Bitcoin approached the $93,000 level, analysts cautioned that significant buying pressure would be required to break higher.
Several traders identified a dense resistance zone between roughly $92,600 and $94,000.
Volume-weighted average price levels were highlighted as forming a major technical barrier.
“The chop from the past few days has made it so there’s some decent liquidity built up on both sides,” said trader Daan Crypto Trades.
He noted that downside liquidity remains concentrated between $89,800 and $88,700.
Data showed nearly $170 million in crypto liquidations over a 24-hour period, reflecting heightened volatility.
Despite the range-bound conditions, traders broadly agreed that the current consolidation phase may not last much longer.
“No doubt that this current ~$90K-$92K range won’t last much longer,” Daan Crypto Trades added.