Data shows the stablecoin sector as a whole has continued to observe net outflows recently, but Tether (USDT) has only expanded further.
USDT’s Dominance Among The Stablecoins Has Now Grown To Nearly 70%
In its latest weekly report, the on-chain analytics firm Glassnode has looked into the capital flows into and out of the cryptocurrency market to see how the sector has been doing recently.
To check for these capital flows, the firm has considered the change in the valuations of three asset classes, Bitcoin (BTC), Ethereum (ETH), and stablecoins, since these three make up most of the digital asset sector.
Now, here is a chart that displays the data for these netflows over the last few years:
The different capital flows in the market | Source: Glassnode's The Week Onchain - Week 37, 2023
As shown in the above graph, the stablecoin netflows have been negative since April 2022, meaning that capital has constantly been exiting the sector. Bitcoin and Ethereum were also seeing outflows at first inside this period until the year 2023 rolled around and they flipped towards inflows.
Recently, however, both these assets have approached neutral or negative netflows, implying that capital is once again exiting the cryptocurrency sector as a whole. This can suggest that there isn’t much interest in investing in the sector right now.
In total, the stablecoins have seen the exit of $43 billion, suggesting a sizeable decline of 26% inside this period. The aggregate stablecoin market cap has now fallen to just $120 billion, as the below chart highlights.
The value of the metric has been going down | Source: Glassnode's The Week Onchain - Week 37, 2023
“This can be argued to be a result of both capital leaving due to bear market conditions, but also a reflection of t
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Author: Hououin Kyouma
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