Here’s What This Means (Analysis)
Stablecoins remain the most traded assets in the crypto market. Fresh data from on-chain analytics firm CryptoQuant shows that nearly $2 billion worth of those tokens were recently moved into exchanges.
According to Ki Young Ju, CEO of CryptoQuant, these massive deposits are actually a bullish sign for the industry.
Ju noted that most crypto trading platforms usually fill the market to enable users to purchase different coins, including Bitcoin (BTC), Ethereum (ETH), and others, as traders prefer to buy these assets using stablecoins rather than fiat.
He added that exchanges sometimes hold large volumes of stablecoins in reserve in order to process users’ withdrawal requests during high market volatility.
Ju: People are Converting Fiat Money to Crypto
Regardless of what the reason might be for the increasing inflow, Ju believes the high demand for stable assets and their movement into exchanges is bullish in the long-term since “fiat money is converting to crypto assets.”
Ju’s opinion about the increasing use of stablecoins for crypto purchases correlates with what’s going on in many countries across the world as the demand for fiat continues to decline.
For instance, people living in countries with unstable economies like Argentina, Brazil, and Nigeria are increasingly choosing to have their savings in stablecoins backed by a stronger currency like the United States Dollar (USD) to save themselves from an imminent financial crisis.
Total Stablecoins on Exchanges Nears $20B
With the addition of $1.7 billion to the existing volume of stablecoins on exchanges, the total volume across global cryptocurrency trading platforms has reached a new all-time high (ATH) of $19.23 billion, per data on CryptoQuant.
The stablecoin inflow is up over 500% since the beginning of the year. The massive increase in YTD could be a result of rising cryptocurrency interest in recent times.
USDT & USDC in Top Ten Largest Coins
Meanwhile, CoinGecko data suggests that the two largest stablecoins – Tether (USDT) and USD Coin (USDC) – are in the top ten rankings of the world’s largest cryptocurrency by market capitalization.
While USDT, which has a market capitalization of $65 billion, is in the fifth spot, USDC sits at the eighth position with a market cap of $27 billion.
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