More than 55% of the total stablecoins in circulation were in the custody of whales. Stablecoin reserves on exchanges have increased substantially since the beginning of the year.
One of the biggest bullish signs for the cryptocurrency market is the increase in stablecoin reserves. This is because they are widely used to purchase other cryptocurrencies, while preserving fiat value.
Whales Accumulate Stable Coins
According to on-chain analytics firm Santiment, whale wallets with over $5 million in holdings have been on a stablecoin accumulation spree for the past three weeks.
In fact, this cohort acquired over 5% of the total supply of these leading coins, including USDT, USDC, DAI, and TUSD, over the past three weeks. As of April 1, more than 55% of the total stablecoins in circulation were in the custody of whales.
Bitcoin in Consolidation Period
An unprecedented move reported by on-chain data provider CryptoQuant anticipates bullish potential for bitcoin (BTC). This is the largest entry of the USD Coin (USDC) stablecoin in history on the Coinbase exchange.
As the chart on which the analysis was based shows, the inflow was more than $1.4 billion in USDC. “This sizable deposit indicates potentially significant buying pressure” for Bitcoin, said Maarten Regterschot, market researcher and community manager at CryptoQuant.
The unprecedented entry of USDC anticipates that the USD 60,000 that bitcoin recently touched could be a local minimum of the current bullish trend. In other words, the market may be preparing to increase its demand at current prices, driving the upside.
The currency has been lateralizing in the last three weeks between USD 60,000 and USD 73,700, its new all-time high. Therefore, the market is currently in a consolidation stage after setting such a record.
This scenario takes place while analysts remain bullish in the medium term due to the halving scheduled for the second half of April. This event, which occurs every four years, is the halving of the currency’s issuance, which limits the sales pressure, leading to an increase in price.
Will Buying Pressure Increase?
Santiment agreed with the theory that whales could be waiting for the market to correct significantly, allowing them to buy big and increase their Bitcoin. [BTC] positions.
Interestingly, the market pulled back on April 1st. AMBCrypto investigated CryptoQuant data and detected net inflows of stablecoins to cryptocurrency exchanges, lending credence to the aforementioned narrative.
Stablecoin reserves on exchanges have increased substantially since the beginning of the year. Recently, nearly 20.36 billion coins were held in exchange wallets, the highest number in over a year.
Historically, the rise of stablecoin deposits has preceded a sharp rise in the market price of Bitcoin. Therefore, there was a higher chance of higher volatility and a Bitcoin bounce in the next two weeks or so.
Top Stablecoins in Full Demand in 2024
Meanwhile, the global stablecoin cap continued to rise, surpassing $143 billion for the first time since 2022. The recovery was led by the two leading assets: USDT and USDC.
The world’s largest stablecoin, USDT, has continued last year’s positive momentum, growing 13% year-to-date (YTD) to a whopping $104 billion in market valuation.
However, the real success story has been USDC, which jumped 33% year-to-date to $32 billion after encountering significant downsides last year.
By Leonardo Perez
