Stablecoin Inflows Surge: Buyers Bullish as BTC Inflows Low

• CryptoQuant has reported an increase in stablecoin exchange inflows, signifying a potential uptick in buying pressure.
• Centralized crypto exchanges have been experiencing increased inflows (deposits) of stablecoins, despite a short-term decline in the price of Bitcoin.
• Ethereum continues to dominate the stablecoin market with 60% of the total share, followed by TRON’s 27% and Binance’s 7%.

Stablecoin Inflows to Crypto Exchanges: Are Buyers Bullish?

Stablecoin On-Chain Data Providers Findings

CryptoQuant has reported an increase in stablecoin exchange inflows, measuring the year’s highest level. Low BTC inflows have indicated a preference for holding and accumulating. Tether and Circle have been actively minting throughout Q1 of 2023, significantly increasing their circulating supplies. Centralized crypto exchanges have been experiencing increased inflows (deposits) of stablecoins, signaling a potential uptick in buying pressure. Despite this coinciding with a short-term decline in the price of Bitcoin, analytics firms have suggested that the market’s potential purchasing power is strengthening.

Stablecoin Exchange Netflow Data

According to recent reports by CryptoQuant, centralized crypto exchanges have been seeing increased stablecoin inflows. On March 5th, the data aggregator reported the „highest level [of inflows] of this year“ as stablecoin balances on crypto exchanges surged. Stablecoins being deposited on exchanges often signifies that investors are preparing buy orders at current or lower levels.

Centralized Exchanges vs Stablecoin Giants

Glassnode noted a new one-month low for USDC at 1,544 for March in terms of the number of unique addresses that received incoming transactions within a given hour. Despite this, February saw USDT achieve a monthly high mean transaction volume, even with the average number of exchange BTC deposits typically indicative of market direction at a monthly low; reinforcing people’s preference for holding and accumulating instead of selling now. CoinGecko reported that Ethereum has continued to dominate the stablecoin market with 60% of the total share whereas TRON holds 27% following a 5.9% increase and BNB Chain third with 7%. Currently these tokens account for 12.7% of all cryptocurrencies with around $136 billion capitalization according to CoinGecko’s figures.

The Impact Of This Trend

With increasing amounts going into centralized crypto exchanges through these fiat backed tokens it is likely we will see some positive changes within cryptocurrency markets over time as more buyers enter into positions waiting for prices to appreciate further from current levels or take advantage during dips when prices fall momentarily creating more trading opportunities for those who want to add exposure through these means rather than just HODLing (holding).

Conclusion

Overall it appears that despite price drops being seen across many digital assets recently there is still optimism within markets judging from data collected from various sources regarding recent influxes coming from Centralised Exchanges via Stablecoins such as Tether and USDC etc which suggests buyers may be taking advantage whilst prices are still relatively low before any potential rise happens later this year or beyond 2021 depending on how things develop moving forwards