JAIPUR (Coinchapter.com) – Stablecoin reserves on cryptocurrency exchanges boomed exponentially over the past week.
The accumulated value of fiat-pegged cryptocurrencies kept rising in 2021, even with May’s drastic crypto market correction. Moreover, significant spikes on a few occasions paved the way for a continuing uptrend in stablecoin deposits in exchange wallets.
From around the $3 billion figure logged during January, stablecoin deposits shot up by 84% to clock $19 billion in August. Stablecoins collectively have amassed a market cap of nearly $120 billion and command $56 billion in trading volumes.
Previously, increasing stablecoin deposits have coincided with crypto market rallies, especially Bitcoin.
Related: Bitcoin Eyes Major Rebound to $50,000 on Booming Stablecoin Deposits
Stablecoins facilitate speedier crypto trades since they are essentially equal fiat currency value but in crypto form. As a result, traders don’t have to fret about converting their cryptocurrency holdings to actual fiat money for making trades.
Increasing stablecoin inflows on exchanges indicates a potential buying trend for cryptocurrencies. Conversely, rising stablecoin outflows point to impending selling pressure in the market. The correlation between the stablecoin supply ratio and Bitcoin prices to date corroborates the above.
Whales or large holders of cryptocurrencies have gone up in number as per ecoinometrics.
” Recently there has been some on-chain divergence between:
Small fish who are accumulating coins.
Whales who are offloading coins.
That’s not ideal to support #Bitcoin’s price, but it looks like things are changing!
observed ecoinomentrics in a recent tweet
The Bitcoin on-chain and macro analysis newsletter service noted a renewed accumulation trend amongst whales. These wealthy Bitcoin investors with holding sizes ranging from 1,000 – 10,000 BTC joined their “small fish” counterparts in placing buy bids on the top cryptocurrency.
Related: Bitcoin whales hold 25% of the BTC supply as other entities keep accumulating
Accumulation sentiment has been strong amongst small fishes. And as per statistics that ecoinometrics presented, the less affluent Bitcoin holding group completely absorbed the selling pressure from whales. But whales joining the accumulation bandwagon, along with rising stablecoin deposits, points to a bullish scenario.
“Strongest on-chain accumulation in the history of Bitcoin. Bears are flat out wrong, enjoy the shake out before $50K+”
said on-chain Bitcoin analyst will Clemente
“#Bitcoin price is currently sitting at the top end of a strong on-chain support zone. Over 1.65M $BTC now have an on-chain cost basis within the $45k to $50k range The green zone below, at $31k to $40k, is also home to another 2.98M $BTC, indicative of large accumulation demand.”
noted Glassnode
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