The chief executive of digital asset analytics firm CryptoQuant says stablecoins are seeing increased adoption thanks to expanding use cases.
CryptoQuant’s Ki Young Ju tells his 368,500 followers on social media platform
On-chain analyst data shows that only about one in five stablecoins are used to buy and sell cryptocurrencies.
“As of September 2021, stablecoin exchange reserves exceeded $30 billion. From that point on, I considered the stablecoin market to be sufficiently developed, making comparisons from that era valid.
Today, the stablecoin market cap is $166 billion, primarily used for storage or remittances, of which only 21% is held on exchanges (compared to over 50% in 2021).
The total stablecoin market cap is increasing, but most of the new supply is used for purposes other than trading on exchanges.
Ki Young Ju notes that people around the world are starting to realize the benefits stablecoins offer for moving money across borders.
“Mainly for remittances to all countries. As far as I know, Stablecoin adoption in Africa is crazy.
With stablecoins increasingly used for cross-border payments and potentially as a store of value for citizens of countries experiencing massive devaluation of their currencies, Ki Young Ju says Bitcoin (BTC) and crypto need to find another source of liquidity to increase prices.
“Stablecoins alone cannot provide sufficient buy-side liquidity for Bitcoin.
The BTC/stablecoin ratio is 6.05, which means BTC reserves are six times higher than stablecoins, similar to the last all-time high.
Exchange-traded fund (ETF) flows and Coinbase USD liquidity will be crucial for the coming months.
Don’t miss a thing – Subscribe to receive email alerts straight to your inbox
Check Price Action
Follow us on XFacebook and Telegram
Surf the daily Hodl mix
 
Disclaimer: Opinions expressed on The Daily Hodl do not constitute investment advice. Investors should conduct due diligence before making high-risk investments in Bitcoin, cryptocurrency or digital assets. Please note that your transfers and transactions are at your own risk and any losses you may incur are your responsibility. The Daily Hodl does not recommend the purchase or sale of cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured image: Shutterstock/creativeneko/NeoLeo
