FOR SALE

USDC is the Driving Factor Behind the Current Stablecoin Inflow Increase

5007f09119678

ajax loader

When cryptocurrency markets become volatile, the first thing people look for is stablecoin balances. As it turns out, there is an increase in the stablecoin inflow for all exchanges. However, that volume isn’t originating from the currencies most people would expect. 

Stablecoin Inflow is on the Rise

Ever since Bitcoin has attempted to recover a new all-time high for the second time in quick succession, the market has been rather volatile. Speculators hoping to see $20,000 will have to be patient for a bit longer. Several factors influence these two price level rejections. One is the psychological aspect, and the other is the stablecoin inflow affecting all exchanges.

Speaking of which, there is an increased inflow of stablecoins as of late. This can have interesting consequences for Bitcoin, as well as other currencies. In the past, an increasing stablecoin inflow would usually lead to Bitcoin’s price rising. Under the current circumstances, the impact cannot be accurately predicted. 

BlocDesk Stablecoin Inflow Exchanges 1024x374 1
Source: CryptoQuant

It has to be said, the increase is not too spectacular. Current stablecoins flows are much lower compared to June of 2020, or more recently, October. An interesting turn of events that indicates there may not be any major price changes over the coming days. However, there will always be some market action to keep an eye on.

Additionally, one has to keep in mind the chart above depicts transactions, rather than amounts. It is possible the actual value of all stablecoins on exchanges has surged by a significant margin. Unfortunately, it is very difficult to quantify that data due to transparency issues. Until that situation changes, all one can do is guess.

Identifying the Popular Stablecoins

The obvious candidate for increasing the stablecoin inflow is Tether’s USDT. Currently, the ERC-20 variant of this asset is the most popular by a landslide. It is all the more surprising to see its reserves on exchanges decrease during this period. The change is minimal, but it may not be a contributing factor to this broader trend. 

Looking beyond USDT, there is significant growth for USDC on exchanges. It too may not necessarily be the main contributor to the stablecoin inflow increase, but this difference cannot be ignored that easily. Nearly $150 million in USDC were added to exchange reserves in the past week. 

BlocDesk Exchange USDC Reserves
Source; CryptoQuant

Keeping all of the above in mind, it is safe to assume market volatility will not end soon. Bitcoin remains very close to that $20,000 level, triggering plenty of speculation and excitement. What that means for the alternative markets, is anyone’s guess at this point.

The post USDC is the Driving Factor Behind the Current Stablecoin Inflow Increase appeared first on BlocDesk.



Source: USDC is the Driving Factor Behind the Current Stablecoin Inflow Increase

Add a Comment

Your email address will not be published. Required fields are marked *

CryptoNewsPipe.com