Stablecoin Market Capitalization Nears $200 Billion — Bitcoin Price To Resume Rally?

Opeyemi Sule

6 months ago

3 mins read

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The latest on-chain data shows that the stablecoin market is nearing a new milestone in terms of valuation. Here’s how the increasing liquidity could impact Bitcoin and the general cryptocurrency market.

Can The Increasing Stablecoin Cap Push Bitcoin Price To $100,000?

Market intelligence platform IntoTheBlock has revealed in its weekly report that the stablecoin market capitalization has experienced notable growth in the past month. According to the crypto firm, the stablecoin market cap surged past $190 billion this week for the first time since late April 2022 when Bitcoin price was hovering around the $40,000 mark.

This impressive growth comes on the back of Bitcoin’s unprecedented run to a six-figure valuation and the explosion of the total market capitalization to over $3.4 trillion. IntoTheBlock noted that stablecoins have seen increased adoption in the past few weeks, as investors continue to run toward riskier assets like cryptocurrencies.

Specifically, this expansion has primarily been in favor of Tether’s USDT, which continues to completely dominate the stablecoin market. Data from IntoTheBlock shows that USDT holds about 72% of the market share, with a market capitalization of over $133 billion — reminiscent of the crypto market highs of 2021.

Interestingly, the demand for the Tether stablecoin appears to be climbing, with a weekly mint of over $3 billion of new USDT tokens. Most notably, over $13 billion USDT has been minted since the start of November, with the stablecoins largely flowing toward centralized exchanges.

This injection of fresh liquidity into centralized exchanges has been reflected in the market, especially with the strong bullish momentum witnessed in the past few weeks. Historically, increasing stablecoin inflows into exchanges is positively correlated with market prices, as they often represent higher “buying power” for the investors.

As such, the continuation of this positive trend could be pivotal to the dream of Bitcoin price surpassing $100,000. While the flagship cryptocurrency has seemingly recovered from its recent slump beneath the $93,000 level, it has not exactly shown strength sufficient to surpass the six-figure milestone.

As of this writing, the price of Bitcoin continues to hover around the $96,500 mark, reflecting a more than 2% increase in the last 24 hours. According to data from CoinGecko, the premier cryptocurrency is still in the red on the weekly timeframe, with a 3% decline in the past seven days.

BTC Market Becoming Stable And Mature: IntoTheBlock

IntoTheBlock also disclosed in its weekly report that Bitcoin’s market climate seems to be maturing, as volatility is currently trending downwards. According to the blockchain platform, the market’s high volatility has been a long-standing criticism point for BTC as a store of value.

However, IntoTheBlock noted that investors can expect the Bitcoin price performance to be more stable, as retail and institutional adoption increases and volatility diminishes. Hence, the premier cryptocurrency could become an even more reliable store of value.

Featured image from iStock, chart from TradingView

Opeyemi Sule

Opeyemi is a proficient writer and enthusiast in the exciting and unique cryptocurrency realm. While the digital asset industry was not his first choice, he has remained absolutely drawn since making a foray into the space over two years. Now, Opeyemi takes pride in creating unique pieces unraveling the complexities of blockchain technology and sharing insights on the latest trends in the world of cryptocurrencies.

Opeyemi savors his attraction to the crypto market, which explains why he spends the better parts of his day looking through different price charts. “Looking” is a rather simple way to describe analyzing and interpreting various price patterns and chart formations. However, it appears that is not Opeyemi’s favorite part - in fact, far from it.

Being able to connect what happens on a price chart to on-chain movements and blockchain activities is what keeps Opeyemi ticking. “This emphasizes the intricacies of blockchain technology and the cryptocurrency market,” he would say. Most importantly, Opeyemi thinks of any market insights as the gospel, while recognizing that he is only a messenger.

When he is not clicking away at his keyboard, Opeyemi is most definitely listening to music, playing games, reading a book, or scrolling through X. He likes to think he is not loyal to a particular genre of music, which can be true on many days. However, the fast-rising Afrobeats genre is a staple in Opeyemi’s Spotify Daily Mix.

Meanwhile, Opeyemi is a voracious reader who enjoys a wide category of books - ranging from science fiction, fantasy, and historical, to even romance. He believes that authors like George R. R. Martin and J. K.
Rowling are the greatest of all time when it comes to putting pen to paper. Opeyemi believes his reading of the Harry Potter series twice is proof of that.

Indeed, Opeyemi enjoys spending most of his time within the four walls of his home. However, he also sometimes finds solace in the company of his friends at a bar, a restaurant, or even on a stroll. In essence, Opeyemi’s ambivert (haha! been searching for an opportunity to use the word to describe myself) nature makes him a social chameleon who is able to quickly adapt to different settings.

Opeyemi recognizes the need to constantly develop oneself in order to stay afloat in a competitive and ever-evolving market like crypto. For this reason, he is always in learning mode, ready to pick up the slightest lesson from every situation. Opeyemi is efficient and likes to deliver all that is required of him in time - he believes that “whatever is worth doing at all is worth doing well.” Hence, you will always find him striving to be better.

Ultimately, Opeyemi is a good writer and an even better person who is trying to shed light on an exciting world phenomenon - cryptocurrency. He goes to bed every day with a smile of satisfaction on his face, knowing that he has done his bit of the holy assignment - spreading the crypto gospel to the rest of the world.

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