The circulation of the four largest summed currencies has increased to new permanent points, indicating that buyers may soon begin a new phase for the bitcoin and cryptocurrency markets.
The total capitalization of Tether (USDT), USD Coin (USDC), Binance USD (BUSD) and Dai (DAI) has increased by almost 190% since the beginning of this year, from $ 27 billion to almost $ 78 billion.
In a May 3 Chain Report, a Glassnode network analyst indicated that Tether is well positioned as a leader in the stablecoin sector, which accounts for two-thirds of the total market capitalization of the top four stable currencies. USDT total leverage hit a record high of $ 51.78 billion late last week after rising $ 1.48 billion, or 3%, in just seven days.
USDC supply has also increased by almost $ 1 billion in the last week, according to CoinGecko, and currently has capital of $ 14.5 billion. On April 30, it briefly fell to a peak of $ 15 billion.
On May 3, BUSD’s offer hit a record $ 7.8 billion, while DAI’s offer was at $ 3.9 billion at the time of writing.
As the supply increases, Glassnode confirms that the Bitcoin Fixed Supply Ratio (SSR), which measures Bitcoin supply divided by stable currency supply, is still at a low of 13.4 and is approaching an all-time low of 9.6.
Bitcoin-Stablecoin Aspect Ratio: Glass Knot
The graph shows that SSR has been consistently low throughout 2020 and 2021 as supplies surged in an overall stable currency in terms of bitcoin inflation.
According to Glassnode, the decline in the SSR value is an optimistic signal that global sustainable supply is increasing relative to the market value of bitcoins:
“As the total supply of stablecoins increases, this indicates an increase in the ‘purchasing power’ of cryptocurrency capital, which can be quickly exchanged and traded against BTC and other cryptoassets.”
Aave’s liquidity management incentives, launched on April 27, will also boost demand for stablecoin as most of the bonuses have been directed towards investing in USDT, USDC and DAI. DeFi investors noted that the increase in Aave’s earnings had an immediate impact on stable foreign exchange lending, which has more than doubled since late April.