Bitcoin Cash Struggles at $590 Resistance Amid Uncertainty

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Bitcoin Cash (BCH) has hit a crucial resistance level near $590, failing to capitalize on a recent broader rally in the cryptocurrency market. Several factors are contributing to this volatility, including the imminent withdrawal of Tether’s USDT (Tether USD) support on the BCH network, a sharp drop in large whale transactions, and declining trading volumes. These developments have investors weighing BCH’s near-term prospects carefully amid shifting market dynamics.

Tether, the world’s largest stablecoin issuer, announced that it will discontinue support for USDT on the Bitcoin Cash blockchain as of September 1, 2025. This decision also impacts other less active blockchains such as Omni Layer, Kusama, EOS, and Algorand. With USDT’s total market capitalization near $156 billion, Tether’s exit could significantly reduce BCH’s role as a settlement layer for stablecoins, which may curtail on-chain demand. Early data already show that institutional investors are responding cautiously in anticipation of this major change.

Compounding the challenge is a steep 72% decline in the average transaction size of BCH “whales”, large holders who often influence market trends. Data from IntoTheBlock reveals the average whale transaction size dropped from $74,035 on August 4 to just $20,591 by August 9. This sharp contraction suggests that these major players are actively reducing their BCH exposure to mitigate risk as Tether’s departure nears. Reduced whale activity typically leads to lower liquidity, making the BCH market more vulnerable to sharp price swings during turbulent periods.

Trading volume for BCH has also fallen notably in the wake of its failure to break above the $590 resistance level, according to CoinMarketCap. This drop in volume points to profit-taking behavior, where traders close positions after a failed breakout, adding downward pressure on the price.

From a technical perspective, BCH remains trapped between $590 and $600, which coincides with the upper Bollinger Band, a volatility indicator. If BCH can break decisively above $600 on strong volume, the path toward $620 and potentially $650 could open. The Relative Strength Index (RSI), a momentum gauge, currently sits near 57, indicating the market is not yet overbought and may still have room to rise.

However, failure to reclaim the $590 level could trigger a pullback to the mid-Bollinger Band support around $558. A further drop might push BCH toward the lower band near $509, with a deeper slide toward $480 if liquidity tightens faster than expected due to USDT withdrawals.

In conclusion, Bitcoin Cash’s short-term outlook is at a crossroads. The looming end of USDT support on its network, coupled with decreased whale activity and shrinking volume, sets a cautious tone. Investors should watch these key signals closely as September approaches, with the potential for either a breakout or a sharper decline on the horizon.