bullish

The growth in the stablecoin market is a positive indicator for the broader cryptocurrency ecosystem. Despite a downturn in Bitcoin (BTC) and Ether (ETH) amid widespread risk aversion on Wall Street, stablecoins are experiencing a resurgence, reflecting renewed capital inflows into the crypto market.
After months of stagnation, the total market capitalization of stablecoins, which includes hundreds of different coins, has surged to over $164 billion for the first time since the Terra collapse in May 2022. This is a notable increase from the previous $160 billion mark, according to data from DefiLlama and trading firm Wintermute.
Stablecoins, such as Tether’s USDT with a market capitalization of $114.26 billion, are digital currencies pegged to external references like the U.S. dollar. These coins help investors mitigate market volatility by maintaining a fixed value relative to their reference. They are extensively used to fund crypto purchases, derivatives trading, and yield-generation strategies, including decentralized finance (DeFi) lending. Additionally, stablecoins are utilized for real-world payments and cross-border remittances.
Wintermute notes that this expansion signifies growing investor optimism and supports a bullish outlook for the market. The increased stablecoin supply indicates that capital is being injected into on-chain ecosystems, fostering economic activity. This can lead to price appreciation through direct on-chain purchases or improved market liquidity through yield-generation strategies, ultimately promoting positive on-chain growth.
Blockchain analytics firm Nansen echoed this sentiment on X (formerly Twitter), calling the stablecoin expansion a bullish development.
However, BTC and ETH have seen declines of 5.5% and 10%, respectively, this week. This drop is likely a “sell the fact” reaction following the debut of the highly anticipated spot Ether ETFs in the U.S. and a significant decline in Wall Street’s tech-heavy Nasdaq 100 index, which fell 3.7% on Wednesday, erasing $1 trillion in market value.
Additionally, the ongoing decline in the copper-to-gold ratio and the steepening of the U.S. Treasury yield curve contribute to a risk-off sentiment in the market.

Stablecoin Expansion Signals Bullish Trend for Crypto Market Despite BTC and ETH Declines

CoinstelegramEng

2024年7月29日公開の他の記事

Hong Kong Police Arrest Four, Including 14-Year-Old, for Counterfeit Crypto Scam

Hong Kong Police Arrest Four, Including 14-Year-Old, for Counterfeit Crypto Scam

Economy: EDF Announces the End of the Surge in Electricity Prices in France

Shiba Inu, Cardano, And XRP Appear On Santiment’s Top Altcoin Picks

Justin Sun Advocates for Supportive Crypto Regulations in China

Coinbase Demands SEC Release Gary Gensler’s Private Emails in New Court Motion

ニュースレターを購読して暗号資産の最新情報を毎日入手！