According to research by Glassnode, Bitcoin is now well-positioned to attract a large capital inflow from the stablecoin market on short notice.
In its latest weekly report, Glassnode revealed that Bitcoin’s Stablecoin Supply Ratio (SSR) has dwindled to a new low. This is as a result of more investments going into stablecoins.
According to Glassnode, SSR “is the ratio between Bitcoin supply and the supply of stablecoins.” In a case where there is a low SSR, it means “the current stablecoin supply has more ‘buying power’ to purchase BTC.” One of the main reasons SSR would go low is when more capital is flowing into the stablecoins.
Theoretically, BTC stands to grow in market cap by up to 6.5%, if all stablecoins capital flow to the king coin. In reality, however, the growth would be way more than that as the BTC price would also increase in response.
In the past week, BTC has maintained relatively low volatility between $9,070 and $9,260. Josh Rager, a crypto analyst and co-founder of Blockroots, tweeted that “volatility this low has historically led to major price action between 30% to 60% movement in the following weeks.”
In the past month, stablecoins such as Compound (COMP) have seen a surge in market interest.
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