Stablecoins have witnessed significant growth this year. Among them, USDT remains a leader, but other ones, such as Circle-backed USDC, are also seeing considerable activity.
As such, USDC’s recent deposits to centralized crypto exchanges could signal investors buying the dip amidst several market corrections in recent weeks.
USDC Deposits Surge
According to IntoTheBlock’s Head of Research, Lucan Outumuro’s latest findings, USDC’s net inflow into centralized crypto exchanges reached a one-year high of $228 million on June 24. This surge suggests investors are depositing stablecoins to capitalize on lower cryptocurrency prices.
Further validating this trend is a recent observation from CryptoQuant co-founder Ki Young Ju, who noted that while the stablecoin market is increasing, its ratio to Bitcoin’s market mirrors previous all-time highs.
The exchange reserves ratio also indicates that stablecoins have already been utilized as buy-side liquidity. Such a scenario implied that stablecoins may not drive the next market upswing without new inflows.
“Stablecoin market cap is increasing, but its ratio to BTC market cap is similar to previous ATH levels. Exchange reserves ratio as well. This suggests stablecoins have already been used as buy-side liquidity and won’t drive the next leg up without new inflows.”
Room for Growth?
Bitcoin may have been up by almost 103% over the past year, but its trajectory over the past month has been disappointing. After subsequent corrections, the cryptocurrency was trading near $61,400. But it is also important to understand that these declines may offer unique long-term buying opportunities for market players.
Subtle hints of recovery include the US spot Bitcoin ETF’s minor inflow of $31 million, which reversed the week-long outflow streak.
On the technical side of things, Bitcoin’s RSI has moved from heavily oversold levels to around 33 at the time of writing, which is still very low. This essentially suggests significant potential for growth for the world’s largest digital asset.
Experts also suggest the formation of a hidden bullish divergence for Bitcoin on the daily RSI, indicating that the asset could potentially be on the cusp of a bullish breakout.
“A hidden bullish divergence is forming for BTC on the daily RSI. In addition, RSI tagged the oversold territory. Last two times it happened Bitcoin went berserk mode.”
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