Bitrabo Editorial
Surge in Stablecoin Inflows
Recent data shows a significant rise in the exchange inflows of Tether (USDT) and USD Coin (USDC). This trend could hold significance for Bitcoin.
The term “exchange inflow” refers to tracking the total amount of a specific asset being deposited into centralized exchange wallets.
A high value in this metric indicates a large influx of deposits to exchanges, suggesting a demand for trading cryptocurrencies. Conversely, a low indicator suggests investors are holding onto their coins rather than transferring them to exchanges.
For volatile assets like Bitcoin, high deposit volumes might signal a bearish trend as investors may be preparing to sell. However, for stablecoins like USDT and USDC, deposits do not impact their value since they are inherently stable. Nevertheless, they do have implications for the broader market.
Investors often hold capital in stablecoins to avoid the volatility of Bitcoin but eventually intend to re-enter the volatile market. Therefore, increased exchange inflows of stablecoins may indicate that these sidelined investors are gearing up to invest in BTC, potentially leading to a bullish effect on volatile token prices.
Chart illustrating the trend in the 30-day and 365-day moving averages for the combined exchange inflow of USDT and USDC:
During the recent Bitcoin rally to a new all-time high, the 30-day MA USDT and USDC exchange inflows surged, indicating substantial demand for buying the asset. While the metric saw a decline afterward, it has been gradually increasing again and has now reached $53.8 billion per day.
Bitcoin Price
Bitcoin experienced a retracement below $58,000 but has bounced back above $60,000.