BlockBeats reported on August 10 that Darkfost, an analyst at CryptoQuant, said the total stablecoin market capitalization has fallen by nearly $15 billion since May, dropping from roughly $280 billion to $266 billion. According to Darkfost, stablecoin market cap moved sideways from October last year to May this year, which means either no new liquidity entered the crypto market during that period, or fresh inflows were not large enough to drive the market cap higher. He added that even if BTC stabilizes, market demand has not recovered, and insufficient liquidity is limiting BTC's ability to break out to the upside again. The continuous decline in stablecoin market cap since May suggests not only a lack of new capital, but also that existing liquidity may be gradually exiting the crypto market. In that situation, BTC still faces the pressure of insufficient funding demand even if it temporarily stops falling. The figures cited by Darkfost put the drop at approximately 5% of total stablecoin market value.
BlockBeats reported on August 10 that Darkfost, an analyst at CryptoQuant, wrote in a post that the total stablecoin market capitalization has fallen by nearly $15 billion since May. The market cap has dropped from roughly $280 billion to $266 billion.
Darkfost said stablecoin supply had been broadly flat from October last year through May. In his view, that sideways movement means fresh liquidity was not entering crypto during those months, or that any new flows were too small to move the market cap higher.
The current picture is not much better, he argued. Bitcoin may manage to stabilize, but market demand has still not recovered. A lack of liquidity is limiting BTC's ability to push upward again.
The persistent drop in stablecoin market cap since May points to something deeper than an absence of new money, Darkfost added. It may indicate that existing liquidity is gradually exiting the market. In such an environment, BTC faces the pressure of weak funding demand even if it stops falling temporarily.
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