Whats Driving Bitcoins Price Since the Start of the Year? CEO Gives The Real Answer

The recent surge in stablecoin market value could prompt an uptrend in Bitcoin and other major cryptocurrencies, according to an analysis by CryptoQuant.

Julio Moreno, CryptoQuants Head of Research, highlighted the growing importance of stablecoins in providing liquidity to the cryptocurrency market. Moreno pointed to data showing a significant net inflow of stablecoins into centralized cryptocurrency exchanges over the past two months. “Stablecoins on exchanges have grown, with USDT reserves reaching a record high of $22.5 billion so far in 2024,” Moreno said.

Stablecoins, pegged to fiat currencies like the US dollar, act as a bridge for traders, providing liquidity and a stable medium of exchange. As more stablecoins flow into exchanges, they facilitate increased purchasing power for Bitcoin and other cryptocurrencies. Data from CryptoQuant revealed that the total stablecoin market cap hit a record $169 billion this year, a figure Moreno believes is positively correlated with higher Bitcoin prices.

In a recent analysis, CryptoQuant noted a strong correlation between stablecoin inflows and Bitcoins price action, particularly in September. “Stablecoin net inflows influenced the price rally observed towards the end of September,” the article said.

*This is not investment advice.