On February 9, the American professional baseball team based in Washington, D.C., the Washington Nationals, announced the team has partnered with Terra, the open-source blockchain platform and decentralized autonomous organization (DAO). The Washington Nationals detail that the team is a “leading innovator” and is “consistently introducing new technologies to enhance the fan experience.” Washington Nationals Ink Long-Term Deal With Terra Major League Baseball (MLB) team the Washington Nationals has partnered with the blockchain platform and DAO Terra, according to an announcement published by the team on Wednesday. The deal with Terra follows a slew of sports-related deals with crypto firms, but the MLB team will be the first to partner with an open-source blockchain project. In addition to the partnership, the algorithmic stablecoin UST that’s issued on the Terra blockchain will be “accepted as a payment method at Nationals Park as early as next season.” “The Nationals continue t...
Report: Declining BTC Stablecoin Supply Ratio Suggests Exchanges Are ‘Highly Liquid & Ready to Buy’ Crypto Assets
According to a report by Glassnode, bitcoin’s declining stablecoin supply ratio (SSR) indicates an increased supply of newly minted coins on exchanges. In turn, this increase in supply means exchanges are currently “highly liquid and ready to buy up assets such as bitcoin.”
Stablecoin Supply Growth
As explained in the report, the SSR is a ratio of the total value of all bitcoins versus stablecoins. This metric “decreases when (either) the price of BTC is low or when more stablecoins are entering circulation.”
However, with BTC prices are already high, this leaves the increased stablecoin supply as the only possible reason behind the low ratio. Already, Messari data shows that the total stablecoin market capitalization currently stands at approximately $39 billion as of February 1. From this total, the USDT stablecoin accounts for $28 billion or approximately 71% share of the market.
However, as the Glassnode report notes, it is the USDC stablecoin that is seeing “massive exchange inflows in 2021.” In their commentary on the likely impact of such inflows, the report’s authors say:
The number of USDC on exchanges increased by over 112% in January alone, growing from $431 million to over $915 million. This represents almost $1 billion worth of buying power from USDC alone, poised to move into assets such as bitcoin.
The authors also explain that “this high figure should increase investors’ confidence in any dips being quickly bought up, making it a bullish signal.”
Profit Taking Complete
Meanwhile, also weighing in with their own bullish commentary is the onchain analyst, Willy Woo. According to Woo’s analysis, profit-taking is now complete, and “the market has completed a full purge of overheatedness.”
Woo, who uses the spent output profit ratio (SOPR) chart to support his assertion, suggests the crypto market may have gone past the “bearish phase.” He explains that when “SOPR touches the 1.0 line, coins moving between investors no longer carry profit.”
To bolster this point, Woo explains:
To push SOPR lower, investors would have to be willing to sell at a loss. In order to allow for that, we would need to enter a bearish phase, but this is very unlikely as we are bounded by the $29k price floor.
At the time of writing, BTC was trading above $35,700 handle up 5% on Tuesday.
Do you agree that the lower SSR ratio points to high liquidity on exchanges? You can share your views in the comments section below.
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