Bitcoin Decline Sparks Trader Concerns as USDT Faces Selling Pressure on Curve and Uniswap

Thursday morning witnessed the emergence of an unsettling trend as a significant amount of tether (USDT) stablecoins seemed to be undergoing a sell-off on renowned Uniswap and Curve pools, raising initial apprehension among traders due to its substantial value.

USDT balances on Curve's highly sought-after 3pool, a stablecoin liquidity pool consisting of USDT, USDC, and DAI, surged to more than 72% in the early hours of Thursday. This surge indicates that traders had converted substantial amounts of USDT into the stablecoins USD Coin (USDC) and Dai (DAI), amounting to tens of millions.

Curve's 3pool currently boasts a staggering $300 million worth of USDT, along with an impressive sum of nearly $55 million each in dai and USDC.

The existing disparity indicates a growing inclination towards DAI and USDC compared to tether. This sentiment was previously noted during Terra's turmoil in May and the downfall of crypto exchange FTX in November, as reported by CoinDesk.

Tether's CTO, Paolo Arduino, hinted in a tweet that certain traders might be aiming to "capitalize on the general sentiment" within the wider cryptocurrency markets, which experienced a decline in the last 24 hours.

“Markets are edgy these days, so it's easy for attackers to capitalize on this general sentiment,” Arduino said. “But at Tether we're ready as always. Let them come. We're ready to redeem any amount.”

Bitcoin Decline Sparks Trader Concerns as USDT Faces Selling Pressure on Curve and Uniswap

As of Thursday morning, the USDT holdings in Curve's widely used '3pool' have surged to more than 72%, indicating an abrupt imbalance.