Crypto Comeback: Leading Stablecoin Rejoins Bitcoin After Decade-Long Hiatus!

The cryptocurrency market concluded its week on Friday evening, October 2, 2026, amid a phase of powerful strategic accumulation, with the industry's total market capitalization fluctuating between $2.94–$3.03 trillion. This positive sentiment was largely driven by weaker-than-expected U.S. labor market data, which saw Non-Farm Payrolls rise by only 29,000 against expectations of 84,000–90,000, and unemployment climbing to 4.2%. Bitcoin (BTC) responded to this macroeconomic trigger with a significant gain, trading near $86,688.47, up 3.38% over 24 hours, and maintaining its dominance at 59.10%.

Ethereum (ETH) also demonstrated strength, breaking above the upper boundary of its prolonged sideways range to trade at $2,749.47, an increase of 1.69%. The institutional sector mirrored this positive trend, with U.S. spot Bitcoin ETFs recording net daily inflows of +$103 million, according to SoSoValue. BlackRock's IBIT notably absorbed +$196 million, effectively offsetting a $61 million outflow from Fidelity's FBTC. Conversely, Ether ETFs experienced net daily outflows totaling $55 million.

A major infrastructure development saw the world's largest stablecoin, USDT, preparing for its return to the Bitcoin blockchain. Tether, a key backer of the Utexo project, officially announced the launch of USDT on Bitcoin using a new commercial license. This initiative, championed by Tether CEO Paolo Ardoino with the slogan "It's coming home," leverages Bitcoin's base layer security, the Lightning Network's speed, and the RGB protocol's privacy. The technology facilitates client-side validation, keeping most transaction data off the public ledger for private B2B transfers, direct BTC-USDT swaps, and BTC-backed lending without wrapped tokens. Tether co-led Utexo's $7.5 million seed round, alongside Portal Ventures and Big Brain Holdings. Utexo co-founder Viktor Ignatyuk confirmed ongoing strategic discussions with Morgan Stanley representatives to integrate this infrastructure into U.S. and European bank custody services, with hundreds of exchanges and wallets expressing interest.

This return is significant given the current stablecoin landscape: the global market capitalization has reached $300–$306 billion, with USDT dominating at $184 billion (approximately 60% share). Most stablecoin supply currently resides on Ethereum ($146 billion) and Tron ($94–$95 billion), while Bitcoin's share remains negligible, with legacy activity on Omni Layer almost zero and Blockstream's Liquid sidechain holding a modest $30–$34 million. USDT on Lightning, launched in March 2026 via Taproot Assets, still suffers from fragmented liquidity. Utexo's RGB release in October 2026 aims to transform Bitcoin from merely a store-of-value asset into a robust settlement rail for dollar transactions.

Regulatory reforms in Washington are also progressing. On her final day, Commissioner Hester Peirce, alongside new SEC Chair Paul Atkins and Commissioner Mark Uyeda, proposed reforms to digital asset custody rules. These reforms would formally permit RIA advisers and funds to utilize state-chartered trust companies for custody, as well as limited self-custody under strict cybersecurity controls. Concurrently, the CFTC and SEC are expediting the creation of a common set of rules to replace the previously stalled CLARITY Act. SEC Chair Paul Atkins acknowledged the crypto market's evolution, recognizing it as a trillion-dollar asset class that has outgrown its niche status. Other regulations, such as the Federal Reserve's GENIUS Act proposals and the Innovation Exemption for NMS (effective until 2031), remain in force.

Corporate developments further fueled the market, with shareholders of Armada Acquisition Corp. II approving its merger with Evernorth. The combined entity, trading under the ticker XRPN, is scheduled to commence trading on Nasdaq on October 8. The company will hold 473 million XRP on its balance sheet, valued at about $730 million, contributing to a 3.57% rise in XRP to $1.5444. October's XRP unlock followed a standard pattern: of the 1 billion XRP released from escrow, only 300 million entered circulation, with Ripple returning the remaining 700 million to escrow.

Real-world asset (RWA) activity on Solana has reached an all-time high, exceeding 1.2 million unique wallets holding tokenized stocks. In September alone, 775,000 new addresses joined this market, accounting for over half of the total. Consequently, Solana now handles an impressive 95% of on-chain activity in the RWA segment, pushing its native token, SOL, up by 4.18% to $122.62.

In contrast to the broader rally, the artificial intelligence sector, with a total market capitalization of $24 billion, missed out on the current gains. NEAR corrected by 4–9% to $4.80–$4.88, Bittensor (TAO) held steady at $304–$311, and Render settled at $1.91–$1.97. Quant (QNT) experienced a significant plunge of 16% to $250 following news of its integration into The Clearing House system, as the market quickly realized the asset itself was not required for the interbank network's operation. Meme coin SHIB remained a passive participant, trading in a narrow $0.00000575–$0.00000589 range with a market capitalization of $3.4–$3.5 billion.

The market is currently in "greed" mode, marked by a squeeze on bears. Analytics service CoinGlass reported total liquidations in the derivatives market reaching $362.77 million over the past 24 hours, affecting 79,443 traders. Short sellers bore the brunt of these losses, with forced liquidations of short positions amounting to $269.87 million, while long positions lost $92.90 million. Open interest stood at 653,000 BTC (approximately $56 billion), accompanied by a threefold increase in funding rates, indicating an influx of new leveraged long positions rather than solely spot demand.

Key triggers and price levels require close monitoring in the coming days. Bitcoin's dominance at 59.10% confirms its role as the primary beneficiary of capital inflows, with Ethereum's market share at 11.39%. On-chain data from CryptoQuant shows a 40% rise in monthly stablecoin inflows to Binance from addresses holding over $1 million, creating a substantial liquid buffer for buying dips. However, an excessive tilt towards leveraged buyers introduces risks of local price swings; a drop in BTC to around $75,800 could trigger over $6.7 billion in long liquidations, with support at $82,600 and resistance at $87,200–$87,600. Similarly, an ETH fall to approximately $2,420 could trigger more than $4.17 billion in long liquidations, with support at $2,635–$2,660 and resistance at $2,740–$2,800.

The weak Non-Farm Payrolls report, coupled with modest hourly wage growth of 0.1% and unemployment rising to 4.2%, weakens the argument for a Federal Reserve rate hike in October, suggesting a gradual cooling of the labor market rather than a collapse. Despite this, yesterday's manufacturing ISM PMI price index at 77.9 remains a key inflationary counterweight. Citigroup's annual targets of $113,000 for BTC and $3,028 for ETH continue to provide strong long-term psychological support. The confluence of a weak labor market report, the Evernorth merger (XRPN), Utexo's upcoming USDT launch on RGB, and coordinated SEC/CFTC efforts to replace the CLARITY Act provides a fundamental impulse for the market to test Bitcoin's psychological thresholds of $95,000 and $100,000.