140 billion on Bitcoin and Ethereum
A huge amount of $140 billion is sleeping in stablecoin, that is, in Tether, as well as in USDC, BUSD and other popular versions that are used in the cryptocurrency market and in Bitcoin. This is the starting point from which various analytical studies that have been going on throughout the weekend begin and consider this huge treasury as a fundamentally positive sign.
Positively, because, as it is correct, in our opinion, those who want to exit the cryptocurrency market do not keep such amounts in stablecoins, but have the opportunity to convert them and exit, for a full exit, or for re-entry in the rather distant future. Therefore, the absence of repurchases for such large amounts may indicate that many market participants are actually waiting for a suitable opportunity to return to the market, in all likelihood, waiting for favorable conditions and the return of some calm in the macroeconomic situation.
According to Coinmarketreate.com there has never been such a large amount invested in stable coins, despite the monstrous inflation in the four corners of the globe and the strength of the US dollar, which is only relative. And if this capital returned to the market, even in a small part, it could have a very important impact on the market of Bitcoin and other major cryptocurrencies.
In our opinion, this is a fundamentally correct interpretation, but the growth should be caused by an external event or the cessation of macroeconomic conditions that continue to escalate certain tensions, especially in risk markets such as Bitcoin and major cryptocurrencies.
12% of the total market capitalization
Yes, that’s a lot of money. Suffice it to say that purchases in the amount of 1/100 of this amount sometimes affect the market. And we can say with a sufficient degree of confidence that it makes no sense at all to keep your money in USDT or other stablecoins, no matter how safe they may be.
Because in any case, they can only be spent on one asset class, namely cryptocurrencies, since they do not yet have a real chance of circulation in the stock or bond markets. It will be enough if it is the right key, the right spark to see the return of some of these huge assets to impose a real bull run in the world of cryptocurrencies and BTC.
Yes, but when?
It’s hard to say yet. Several fronts remain open in the economic world — from the recession, which has already technically arrived, to energy prices, which are still completely deviating from the trajectory, to Europe’s difficult situation with regard to debt and supplies of raw materials (in particular, gas from Russia).
As long as such macro conditions persist, it will be difficult to think about a quick return of this capital. But who knows, maybe we will gradually return to much more attractive price levels. And more in line with the reality of Bitcoin, as well as Ethereum.
Selling in May and leaving for this year may not work. Who knows, maybe an unprecedented summer awaits us not only in the cryptocurrency market, but also in the financial markets as a whole.