Stablecoin Market Cap Explodes to $173 Billion — Is This Bearish for Bitcoin?

• The entire market cap of stablecoins surged by 0.48% in seven days since Might 2022.
• A surge in stablecoin valuation suggests a rise in liquidity throughout exchanges.
• Tether USD is essentially the most traded crypto with a quantity of $51B, adopted by Bitcoin and Ether.

The entire market capitalization of stablecoins has surged to $173 billion, a degree not seen since Might 2022. This important improve in stablecoin demand might foreshadow a pullback in Bitcoin’s value as traders accumulate liquidity and await a positive entry level.

In keeping with information from DefiLlama, the entire market valuation of stablecoins rose by 0.48% prior to now week, reaching a brand new excessive since Might 2022. The sector is at the moment valued at $173.013 billion, with Tether USD (USDT) holding a dominant 69.27% share and a market capitalization of $119.6 billion.

Learn additionally: Brazil’s Crypto Soars on 42% Stablecoin Progress And Institutional Inflow

CoinMarketCap information exhibits that USDT is at the moment the highest-traded cryptocurrency within the trade, with an enormous quantity of $51 billion. Bitcoin (BTC) and Ether (ETH) are ranked second and third, with volumes of $27.5 billion and $14 billion, respectively. 

Elevated Stablecoin Market Cap Might Sign a Bitcoin Dip

A rising stablecoin market capitalization sometimes suggests elevated liquidity on digital asset buying and selling platforms. This will likely point out that traders are ready for a market correction to enter the market. Consequently, it’s attainable that Bitcoin may dip barely earlier than stablecoins are used and exchanged for altcoins and BTC.

On the time of press, Bitcoin has surged 2.87% prior to now 24 hours and is buying and selling at $64,568, up 7.65% prior to now month and 140.26% since October 2023. The main digital asset noticed a 69% surge in its buying and selling quantity and is buying and selling at a reduction of 12.37% from its all-time excessive of $73,750 printed earlier this 12 months. 

As per the chart supplied by TradingView above, the Relative Energy Index (RSI) for Bitcoin reads a price of 59.87 which signifies that the bulls are general in control of the cryptocurrency’s value motion. Furthermore, the gradient of the road means that greater costs are attainable.