Data shows stablecoin market cap expansion has slowed to just $1.1 billion recently, signaling weakening liquidity for Bitcoin and other coins.
Now, here is the chart shared by CryptoQuant that shows the trend in the 7-day change in the market cap of the major USD-based stables over the past year:
As displayed in the above graph, the late 2024 bull run was accompanied by a sharp positive change in the market cap of the stablecoins. At the peak, these assets observed weekly net inflows of around $7.7 billion. Another wave of inflows occurred in January of this year, with the metric peaking at $6.6 billion. Since then, the market has seen a cooldown in interest, with inflows into stables staying far from the earlier highs.
From the chart, it’s visible that the sharp burst in capital flows earlier this month could only manage a top of $4.8 billion. The interest also lasted quite briefly, and inflows disappeared soon after. At present, the metric is sitting at $1.1 billion, implying the market cap of the stablecoins is still growing, but clearly, the rate at which it’s happening isn’t close to the previous bull rally.
“Liquidity tailwinds are weaker, limiting Bitcoin’s upside momentum,” explains the analytics firm. It now remains to be seen how long the muted stablecoin inflows would last and whether a pivot to outflows would follow next.
The Relative Unrealized Loss is a measure of the total unrealized loss held by the Bitcoin investors represented as a percentage of the market cap. At present, the metric’s value stands at just 0.5%, which is quite low compared to past bear markets.
At the time of writing, Bitcoin is floating around $113,400, up almost 2% over the 24 hours.
