Based on the information from stablecoins, it appears that traders are making preparations for Bitcoin’s (BTC) price to reach a new peak.
Based on findings from a KuCoin Research report, the rise in stablecoin investments is linked to the approaching Bitcoin reward reduction, scheduled to take place in just over a week.
The report reveals that the emission of Tether (USDT) and USD Coin (USDC) is continuing to grow, indicating increasing interest from European and American investors in crypto assets. Conversely, the issuance of Binance USD, True USD (TUSD), and PayPal USD (PYUSD) has decreased. However, Tether and USD Coin remain the top stablecoins by market capitalization and are still entering the market in substantial amounts.
KuCoin Research analysts wrote,
“The issuance of USDT increased by 5.825 billion in March, and USDC issuance increased by 3.803 billion, showing a significant increase compared to the previous month.”
In the beginning of March, before Bitcoin reached its record prices, there was a significant rise in the holdings of stablecoins.
According to Glassnode analysts, USDT (Tether’s stablecoin) experienced the largest exchange inflow on March 3, increasing by an astonishing 192% from $806.2 million to $2.466 billion by March 5. It is worth mentioning that Bitcoin surpassed its previous record price of $69,800 on the same day, March 5.
“During this period, compared to other stablecoins, the correlation between USDT in CEX and BTC’s price was higher.”
Over the past few days, there’s been a pattern emerging: The combined total of stablecoins on all exchanges has grown from $19.7 billion on April 7th to $20.34 billion now, based on Glassnode statistics. This could mean that traders are getting ready to make new investments, anticipating that Bitcoin will continue its upward trend.
New information from CryptoQuant indicates that there has been an uptick in stablecoin holdings on cryptocurrency platforms during the past few days. Simultaneously, the amount of transactions transferring stablecoins to these exchanges has risen as well.
During this period, the overall value of stablecoins increased by 2.8%, rising from $150.42 billion on April 1 to $154.7 billion at the point of writing, as indicated by DefiLlama’s statistics. USDT holds a dominating share of approximately 69.1% in this total, boasting a market capitalization of around $107.3 billion.
Stablecoin holdings on exchanges and the total value of stablecoins in circulation have often served as useful signals to gauge the stance of market participants regarding trading positions.
According to a study conducted by KuCoin Research, the increase in stablecoins flowing into cryptocurrency exchanges was the catalyst for Bitcoin reaching new record highs in March.
“USDT and USDC continue to lead in total issuance and inflows of stablecoins into CEX, helping to push BTC to historical highs.”
Analysts project BTC to surpass $100,000
Based on a post from X social media user referred to as The Moon, it’s predicted that Bitcoin’s price may surge up to $100,000 by the end of the coming week.
According to Santiment’s analysis, the size of The Moon’s projection seemed significant. However, they emphasized that Bitcoin might reach $100,000 in value if the connection between cryptocurrencies and US stocks weakens further.
In a YouTube video posted on April 11, Brian Quinlivan, the marketing head at Santiment, noted that Bitcoin’s price trend was differing from that of the S&P 500, indicating a potentially positive development for Bitcoin.
In the words of Quinlivan, prolonged rises in Bitcoin’s value during the past fifteen years frequently take place when its price shows minimal connection with the S&P 500 index.
“It doesn’t have to be opposite like this, but if they are moving in their own ways, it’s a good sign that we can continue forward and hit those $80,000, $90,000, $100,000 levels that many of the bulls out there are often mentioning.”
According to econometric price analysis from Econometrics, Bitcoin’s value post-fourth halving may follow historical trends, potentially reaching anywhere from $140,000 to $4.5 million per coin.
“That’s quite the range for sure, but the point is that the lower bound is in the six figures range.”
It remains to be seen if Bitcoin‘s price will surpass $100,000, but the increasing flow of stablecoins suggests that investors anticipate Bitcoin’s value to rise further.
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2024-04-13 03:04