As a seasoned crypto investor with a decade-long journey through the digital asset landscape, I’ve seen my fair share of market ebbs and flows. The recent surge in stablecoin supply and market cap has piqued my interest, reminding me of the pre-election frenzy that followed Donald Trump’s win in 2016.
The total stablecoin supply reached an all-time high of approximately $176.2 billion.
Based on statistics provided by Token Terminal, the quantity of stablecoins has gradually increased following a decrease observed between mid-2022 and early 2023. This trend may have reflected the general pullback in the cryptocurrency market during the “crypto winter.
Since then, the aggregated supply has shown consistent growth.
Stablecoin Market Cap Growth After Trump’s Win
The total amount of stablecoins like Tether and USDC has soared to record levels, and it’s worth noting that these leading stablecoins have also experienced considerable growth in market value. Specifically, CoinMarketCap data indicates that Tether (USDT) witnessed a 7% boost in its market cap, accumulating an additional $8 billion since November 5th. Similarly, USDC from Circle saw nearly a 6% increase, with approximately $2 billion in new market value during the same timeframe.
In simpler terms, Stablecoins (like USDT and USDC) – which are linked to the value of the U.S. dollar – play a crucial role by providing liquidity within cryptocurrency markets. They function as a sort of savings account that can be used to buy other assets. USDT is popularly traded on overseas exchanges, whereas USDC is frequently utilized on platforms such as Coinbase and DeFi networks based in the U.S.
The rise in the total value of stablecoins indicates a higher desire for easy-to-trade assets and increased trading action. This pattern is frequently considered a sign of upcoming market growth. By holding stablecoins, investors are effectively keeping funds on standby for future investment, which suggests faith in the market’s potential.
USDT Netflow Hits Over 1.8B
At the same time as its market value continues to expand, CryptoQuant’s recent study also found that the net flow of USDT (Tether) to exchanges has hit an all-time high exceeding 1.8 billion. This significant increase in stablecoin inflows implies a rise in buying power among investors. This trend indicates that investors may be preparing for potential market shifts, signaling their readiness to make moves.
A large volume of stablecoins moving into exchanges brings significant buying potential. This could increase the desire for Bitcoin and other digital currencies, particularly if the invested funds are tactfully managed.
Throughout this period, there was an unprecedented surge in activity within the wider digital assets sector. Notably, Bitcoin reached record highs shortly after Donald Trump’s election victory. This upsurge was largely due to expectations of a pro-cryptocurrency administration, which ignited optimism and sparked a frenzy of enthusiasm and investment throughout the market.
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2024-11-19 18:10