Stablecoin Shakeup: USD Coin Overtakes Tether on Ethereum

The stablecoin market has undergone a shakeup as USD Coin (USDC) has overtaken USD Tether (USDT) on the Ethereum blockchain. USD Coin Supply On Ethereum Is Now More Than Tether As per the latest weekly report from Arcane Research, USDC has now become the largest stablecoin on the ETH chain, surpassing USDT. A “stablecoin” is a type of crypto token that has its value tied to a fiat currency. Due to this fact, these coins don’t suffer from much volatility, hence their name. Though it must be mentioned that their value isn’t actually fixed, any depreciation or appreciation in fiat carry over to them by nature. These coins can be minted on many blockchains, but the Ethereum chain has been the most popular option for it since years now. Tether and USD Coin are two of the biggest stablecoins in the market right now. And while USDC supply has overtaken USDT on the ETH network, USDT is still the largest fiat token overall, Here is a chart that shows how the supply of the two biggest stablecoins on Ethereum has changed over the past year: Looks like USDC has enjoyed sharp growth in the second half of the year | Source: The Arcane Research Weekly Update – Week 2 As you can see in the above graph, USD Coin has just surpassed the supply of Tether on the Ethereum blockchain. Related Reading | Solo Ethereum Miner Hits The Jackpot With 170 ETH For Mining A Block Over the course of 2021, USDC’s supply grew three times faster than USDT’s. Decentralized Finance (DeFi) has been the main push behind this growth of the coin. In USDT’s case, the driver behind its growth has been centralized exchanges and institutions. This is why the graph for Tether’s supply shows it moving up in big steps; these organizations usually mint these coins in large bursts. Related Reading | Bitcoin Implied Volatility Plummets To Pre-Bull Market Levels: What This Means On the other hand, USD Coin’s supply curve has a more natural growth to it because of crypto traders using it for DeFi. The report predicts that USDC will surpass USDT to become the biggest stablecoin overall in 2022 as its growth has been much faster recently. ETH Price At the time of writing, Ethereum’s price floats around $3.1k, down 3% in the last seven days. Over the past month, the crypto has lost 20% in value. The below chart shows the trend in the price of ETH over the last five days. ETH’s price seems to have plunged in the last few days | Source: ETHUSD on TradingView Ethereum has been in consolidation for a while now, as has been most of the crypto market. At the moment, it’s unclear when the coin may be able to escape from this sideways movement. Featured image from Unsplash.com, charts from TradingView.com, Arcane Research

How Bitcoin Is Controlling The Ebb And Flow Of Crypto

Latest data shows that so far in the year 2022, the rest of the crypto market has been moving in tandem with Bitcoin. Crypto Indexes Follow Bitcoin In January So Far As per the latest weekly report from Arcane Research, all the various indexes in the crypto market have mimicked BTC’s movements so far in the month of January. The “crypto indexes” here refer to groups of cryptocurrencies separated into these divisions on the basis of market cap. There are three main indexes, the “large cap index,” the “mid cap index,” and the “small cap index.” The below chart shows how these various groups have performed compared to Bitcoin in the year 2022 so far: Looks like monthly performance of the mid cap index has been the best so far | Source: The Arcane Research Weekly Update – Week 2 As you can see in the above graph, the various crypto indexes seem to be moving in tandem with Bitcoin in the year so far. Related Reading | 70% Of Bitcoin Supply Is In Profit – Why Bulls Need To Defend This Level BTC’s returns in January stand at double digits in the red at the moment, closely followed by the small cap index which also has 10% in losses. The large cap has also traced Bitcoin quite closely as its losses stand at 8% right now. The reason for its slight overperformance against BTC has been due to the strength of DOGE, NEAR, and ADA. While the mid cap index has also mimicked the moves made by BTC, its strength has been much more as its returns for the month are at just 2% in the red. Related Reading | Bitcoin Supply Shock: Only 12% Of BTC Supply Is On Exchanges Now The mid cap index has outperformed the rest of the market thanks to the strength of UNI and MATIC, two cryptos that account for about 20% of the total index. Bitcoin’s dominance has once again dropped in the last week as its share of the total crypto market cap now floats below 40%. The below table shows the percentage of the total market cap that the top coins occupy right now. BTC’s share of the market cap has taken a hit of 0.76% over the past week | Source: The Arcane Research Weekly Update – Week 2 Ethereum’s dominance has also dropped in the past week, while smaller altcoins have enjoyed a larger percentage of the market cap. BTC Price At the time of writing, Bitcoin’s price floats around $41.9k, down 2% in the last seven days. Over the past month, the crypto has dropped 10% in value. The below chart shows the trend in the price of BTC over the last five days. BTC’s price has mostly moved sideways in the last few days | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, Arcane Research

70% Of Bitcoin Supply Is In Profit – Why Bulls Need To Defend This Level

On-chain data shows about 70% of the total Bitcoin supply is currently in profit, a level that has historically been important for bulls. Around 30% Of Total Bitcoin Supply Is Now Underwater As per the latest weekly report from Glassnode, the percentage of BTC supply in profit has now fallen off to just 70%. The “percent of supply in profit” is an indicator that measures the percentage of the total Bitcoin supply that’s currently in the green. When the value of this metric increases, it means more coins have started to get into profit. This leads to holders becoming more probable to sell their coins in order to harvest their gains. At very high values of the indicator (more than 95%), the price of Bitcoin has usually approached a top as profits are realized. On the other hand, when the metric moves down, it means more coins are entering into the red. Below certain low levels, investors may capitulate to cut their losses. However, when more than 50% of the supply is underwater, bottoms have historically formed. Related Reading | Green Energy: In NY, Bitcoin Mining Saved The Oldest Working Hydroelectric Plant Now, here is a chart that shows the trend in the value of the Bitcoin supply in profit over the last couple of years: Looks like the value of the indicator has declined recently | Source: The Glassnode Week Onchain – Week 3, 2022 As you can see in the above graph, the metric has been falling down since a few months now. And so at the moment, only around 70% of the Bitcoin supply is in profit. Related Reading | Bitcoin Miners Show Strong Accumulation As Their Inventories Spike Up The 70% level seems to have been significant historically as bulls had to defend it twice in the past two years. The first instance was shortly after the COVID crash, between May 2020 to July 2020. The other instance was 2021’s mini-bear period between May and July. The bulls came out on top during both the periods after a while of sideways movement. The report notes that the medium-term outlook of the price likely depends on how the market responds to the level this time. If more of the supply enters underwater, those in the red may finally capitulate. On the other hand, a bullish reversal can bring more Bitcoin into profit and prevent these holders from selling here. BTC Price At the time of writing, Bitcoin’s price floats around $42k, up 0.5% in the last seven days. Over the past month, the crypto has lost 8% in value. The below chart shows the trend in the price of BTC over the last five days. BTC’s price has once again stumbled down in the past few days | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, Glassnode.com

Bitcoin Supply Shock: Only 12% Of BTC Supply Is On Exchanges Now

Percentage of the Bitcoin supply on exchanges has dipped further down to 12% recently, as the supply shock continues to deepen. Just 12% Of Bitcoin Supply Is Now Held By Exchanges As pointed out by an analyst in a CryptoQuant post, the percentage of BTC supply stored on exchanges has now dropped down to just 12%. The all exchanges reserve is an on-chain indictor that measures the total amount of Bitcoin currently held by wallets of all exchanges. The “percentage of BTC supply on exchanges” is a metric that tells us the ratio between the exchange reserve and the total supply of the crypto. When the value of this indicator moves up, it means exchange wallets are receiving a net amount of coins. As investors usually send their coins to exchanges for selling purposes, this supply is often referred to as the sell supply of the market. Therefore, an uptrend in it can be bearish for the price of the crypto. On the other hand, when the metric’s value moves down, it means holders are withdrawing their Bitcoin from exchanges. Prolonged such trend can imply there is accumulation going on in the market, and the available supply is shrinking. Hence, downwards movement of the indicator can be bullish for BTC. Related Reading | Bitcoin Miners Show Strong Accumulation As Their Inventories Spike Up Now, here is a chart that shows the trend in the value of this metric over the past few years: Looks like the supply on exchanges has been heading down since a while now | Source: CryptoQuant As you can see in the above graph, the percentage of the Bitcoin supply on exchanges has shrunk down to just 12% now. The indicator’s last all-time high (ATH) was made at around 16%. Since then, the metric has been steadily making its way down, and has now dropped 4% in value. Related Reading | Jack Dorsey’s Block To Democratize Bitcoin Mining With Open Source Mining System Some traders believe that this decrease in the supply on exchanges may be creating a supply shock in the market. Such a scenario would be bullish for the price of Bitcoin in the long term. However, some recent data goes against the narrative, arguing that the supply has merely redistributed itself in the form of investment vehicles like ETFs. BTC Price At the time of writing, Bitcoin’s price floats around $42.7k, up 3% in the last seven days. Over the past month, the crypto has lost 11% in value. The below chart shows the trend in the price of the coin over the last five days. BTC’s price has once again started to move sideways in the $40k to $45k range over the last few days | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

Bitcoin Miners Show Strong Accumulation As Their Inventories Spike Up

On-chain data shows Bitcoin miner reserve has showed a sharp spike recently, suggesting that miners are currently loading up on the crypto. Bitcoin Miner Reserve Shoots Up; Trend Of Accumulation From Last Year Continues As pointed out by an analyst in a CryptoQuant post, the BTC miner reserve has shown strong uptrend recently. This seems to be a continuation of the accumulation trend from the last year. The “miner reserve” is an indicator that tells us the total amount of Bitcoin currently stored in the wallets of miners. When the trend in the metric is towards up, it means miner inventories are growing as they stock up on more of the coin. Such a trend can be bullish for the price of the coin as it shows miners are currently accumulating BTC. On the other hand, a downtrend in the indicator implies miners have started to dump their Bitcoin. This kind of trend is naturally bearish for the price of the crypto as miners usually sell in big amounts. Related Reading | Why Sovereign Nation States May Begin Acquiring Bitcoin In 2022 Now, here is a chart that shows the trend in the BTC miner reserve over the past couple of years: Looks like the value of the indicator has showed sharp uptrend recently | Source: CryptoQuant As you can see in the above graph, the miner reserve has been gradually moving up since May. A few days back, when the price of Bitcoin dropped down to $39k, the metric showed a huge spike up as miners bought the dip. Related Reading | Jack Dorsey’s Block To Democratize Bitcoin Mining With Open Source Mining System Miners have traditionally been big sellers in the market as they have had to sell some of what they mine to keep their operations running. However, as BTC’s price has risen, and their machines have gotten more advanced and efficient, miners have started selling lesser as it’s enough to sustain electricity and other mining costs. Miners, who have originally always brought selling pressure to the market, have been shifting towards becoming hodlers for a coupe of years now. This can be quite bullish for the price of the coin in the long term. BTC Price At the time of writing, Bitcoin’s price floats around $42k, down 0.6% in the last seven days. Over the past month, the crypto has lost 10% in value. The below chart shows the trend in the price of BTC over the last few days. BTC’s price plunges down after breaking above $44k | Source: BTCUSD on TradingView BTC managed to reach as high as $44.4k in its recent move up, but today the crypto has once again come back down, erasing the gains of the past couple of days. Featured image from Unsplash.com, charts from TraadingView.com, CryptoQuant.com

Bitcoin Revisits $44k As Exchange Outflows See Uptick

Bitcoin has enjoyed some uptrend over the past day as the crypto once again visits the $44k price level. On-chain data suggests that an uptick in exchange outflows may be behind the move. Bitcoin Exchange Outflows Observe A Spike In The Past Couple Of Days As pointed out by an analyst in a CryptoQuant post, the BTC exchange outflows have showed raised values recently. The “all exchanges outflow” is an indicator that measures the total amount of Bitcoin exiting wallets of all exchanges. When the value of the metric goes up, it means more BTC is currently exiting exchanges. Such a trend has usually been bullish as holders usually withdraw their coins to personal wallets for hodling purposes. Prolonged large outflows can be a sign of whale accumulation. On the other hand, when the indicator’s value stays low, it implies not many investors are moving their Bitcoin off exchanges at the moment. This trend can be bearish if the opposite metric, the inflow, spikes up. This is because holders usually deposit to exchanges for withdrawing to fiat or for purchasing altcoins. Related Reading | Bitcoin Death Cross 2022: What You Need To Know About The Deadly Signal Now, here is a chart that shows the trend in the Bitcoin all exchanges outflow indicator over the past year: The indicator’s value seems to have spiked up | Source: CryptoQuant As you can see in the above graph, the value of the Bitcoin outflow has shown an uptick recently. This means that a large amount of withdrawals has taken place over the past couple of days. Related Reading | SOPR Shows Bitcoin Holders Continue To Sell At A Loss, Similar To May-June 2021 According to the quant, this trend might show that the $40k price level is important to some investors. Whenever the crypto approaches a support level, outflow spikes like these usually occur as holders are keen to buy more as Bitcoin’s value dips to such levels. BTC Price At the time of writing, Bitcoin’s price floats around $43.8k, up 2% in the last seven days. Over the past month, the crypto has lost 12% in value. The below chart shows the trend in the price of BTC over the last five days. BTC’s price seems to have finally shown some upwards momentum | Source: BTCUSD on TradingView After weeks of trending downtrend, Bitcoin finally seems to have shown some solid movement up as the crypto broke past the $44k mark several times in the past day. The move may have been fueled by the recent uptick in the exchange outflows. It’s unclear at the moment if this is the rally that will help the crypto escape from the $40k to $45k range. Nonetheless, it’s some upwards momentum for the coin at last. Featured image from Unspash.com, charts from TradingView.com, CryptoQuant.com

Crypto Fear Reaches Six-Month Peak: Time To Buy Bitcoin?

Fear in the crypto market is now the highest it has been in the last six months, suggesting that now may be the time to buy Bitcoin. Crypto Fear And Greed Index Shows Lowest Value In Six Months As per the latest weekly report from Arcane Research, the fear and greed index reached the lowest values this week since July. The “fear and greed index” is an indicator that measures the general sentiment around the Bitcoin and wider crypto market. The metric uses a numeric scale that goes from zero to hundred for representing the sentiment. When the values are below fifty, it means the market is currently fearful. On the other hand, values above fifty imply that the market has become greedy. Extreme values of below 25 and above 75 signify sentiments of extreme fear and extreme greed, respectively. Such extreme values usually occur around bottoms and tops. Hence, some traders believe it’s best to sell during extreme greed and buy more crypto like Bitcoin while the sentiment is that of extreme fear. Warren Buffet believed in this idea, as suggested by a famous quote of his: “be fearful when others are greedy, and greedy when others are fearful.” Baron Rothschild is believed to be one of the earliest of traders to follow this philosophy. He said “the time to buy is when there’s blood in the streets.” Related Reading | SOPR Shows Bitcoin Holders Continue To Sell At A Loss, Similar To May-June 2021 Now, here is a chart that shows the trend in the Bitcoin fear and greed index over the past year: Looks like the value of the indicator is very low at the moment | Source: The Arcane Research Weekly Update – Week 1 As you can see in the above graph, the crypto market sentiment seems to be that of extreme fear at the moment. Currently, the value of the indicator looks to be around 21. Earlier in the week, the fear and greed values were even less, reaching the same lows as the ones seen back in July. The price of Bitcoin also bottomed around then. Related Reading | ARK Invest CEO Cathie Wood On What Will Drive Bitcoin Correction However, it doesn’t mean a bottom will necessarily follow this time as well. Before the July bottom, such extreme fear values persisted for a few months, which may also be the case this time. Nonetheless, if the contrarian buying philosophy is anything to go by, now might be a good time to pack up on more crypto. Bitcoin Price At the time of writing, BTC’s price floats around $42.8k, down 8% in the last week. The below chart shows the trend in the price of the crypto over the past five days. BTC’s price shows some uptrend | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, Arcane Research

SOPR Shows Bitcoin Holders Continue To Sell At A Loss, Similar To May-June 2021

The on-chain indicator SOPR suggests that Bitcoin holders have continued to sell at a loss for a while now. This behavior is similar to what was seen during the May-June 2021 mini-bear period. Bitcoin Investors Have Continued To Dump At A Loss For A Month Now As pointed out by an analyst in a CryptoQuant post, the BTC SOPR shows that holders are currently selling at a loss. The “Spent Output Profit Ratio” (or SOPR in short) is an indicator that tells us whether coins moved on a given day were sold at a profit or a loss. The metric measures so by looking at each coin on the chain and checking what the price the coin was last moved at. After that, the indicator calculates the ratio between this price and the current price. When the value of the indicator is above one, it means that holders are currently selling, on an average, at a profit. On the other hand, when the SOPR has values less than one, it implies investors are moving their Bitcoin at a loss overall. Finally, there is the case when the value of the indicator is exactly equal to one. During such a period, the market is breaking even on BTC sales. Related Reading | Is The Bitcoin Hashrate Recovering From Kazakhstan’s Crisis? Fear Abides Now, here is a chart that shows the trend in the value of the Bitcoin SOPR over the past year: Looks like the value of the indicator has stayed below one recently | Source: CryptoQuant As you can see in the above graph, the Bitcoin SOPR currently has a value less than one, which means holders are selling at a loss. Related Reading | Bitcoin Open Interest Continues To Rise, Short Squeeze Incoming? Such a trend has been there for a month now. A similar situation was there after the May 2021 crash where the indicator stayed below one for a prolonged period of time. It’s possible that the current trend of low SOPR values will continue for a while, just like back then. The period around May-June was marked by a mini-bear market, and so if the trend does repeat, a similar bear environment could follow in the near future. BTC Price Yesterday, Bitcoin’s price briefly declined below the $40k mark, but since then has jumped back up. At the time of writing, the price of the coin floats around $41.7k, down 10% in the last seven days. Over the past month, the crypto has lost 13% in value. The below chart shows the trend in the price of BTC over the last five days. BTC’s price has continued to move sideways above $40k in the last few days | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

Bitcoin Open Interest Continues To Rise, Short Squeeze Incoming?

On-chain data shows Bitcoin open interest and estimated leverage ratio metrics have continued to rise recently. This could mean that a short squeeze may be coming soon. Bitcoin Open Interest Rises Despite Decline In Price As pointed out by an analyst in a CryptoQuant post, the BTC open interest has shown uptrend over the past month, despite the price of the crypto moving down. The “open interest” is an indicator that measures the total amount of Bitcoin futures contracts that are currently open in the market. When the value of the metric moves up, it means more investors are opening long or short contracts on derivative exchanges. This may mean that leverage is going up in the market, and thus such a trend can lead to higher volatility in the price of the crypto. On the other hand, a decline in the metric suggests holders have started to close their positions. A plunge in the indicator happens when Bitcoin makes a strong price swing, forcing mass liquidations of the contracts. Such liquidations cascade together and amplify the price move. This event is called a long or short squeeze, depending on which contracts make up the majority. Related Reading | Bitcoin Fear And Greed Index Has Dipped To Lows Not Seen Since July Now, here is a chart that shows the trend in the Bitcoin open interest over the past year: The indicator’s value seems to be trending up | Source: CryptoQuant As you can see in the above graph, the Bitcoin open interest has been going up, despite the price moving down. This is different from the trend around the $69k top as there longs made up the majority and hence the open interest followed the price. Related Reading | Why Bitcoin Could Frustrate Bulls And Bears In 2022 The higher percentage of futures contracts looks to be short holders this time as the indicator has been moving opposite to the price. BTC Estimated Leverage Ratio Continues To Reach New Highs Another metric, the “Estimated leverage ratio,” measures the average amount of leverage that each futures holder is making use of. This indicator has been making new highs recently, suggesting that short holders are taking a lot of leverage risk right now. The below chart shows this trend. Leverage in the market moves up | Source: CryptoQuant Such a large amount of leverage has historically lead to a flush sooner or later. And since this time the derivatives market is dominated by short holders, a short squeeze event could take place. At the time of writing, Bitcoin’s price floats around $41.6k, down 12% in the past week. Below is a chart that shows the trend in the price of BTC over the last five days. BTC’s price has moved sideways in the last few days | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

Bitcoin Fear And Greed Index Has Dipped To Lows Not Seen Since July

Following the Bitcoin crash to $42k, the fear and greed index has declined to extreme fear values not seen since July of last year. Bitcoin Fear And Greed Index Points At “Extreme Fear” As pointed out by an analyst in a CryptoQuant post, the BTC fear and greed index has dropped to very low values. The “fear and greed index” is a crypto indicator that measures the general sentiment among investors in the market. The index uses numbers to represent the sentiment on a numeric scale that goes from zero to hundred. Values of the indicator above fifty mean that the current holder sentiment is that of greed. And values below 50 imply that the market is fearful at the moment. Index values below 25 and those above 75 fall into the “extreme” category, signifying extreme fear and extreme greed, respectively. The indicator usually remains in the greed zone during bull runs. Extreme greed values have historically signaled that a correction in the price of Bitcoin may be near, and a top could form. On the other hand, values of fear may be there during bearish trends, and extreme fear might imply that a bottom could soon form. Related Reading | Bitcoin Whales Contribute 90% Of Money Inflow of Exchanges, How Can We Follow and Make Profits? Now, here is a chart that shows the trend in the Bitcoin fear and greed index over the past year: The crypto fear and greed index seems to have sunk to extreme fear values | Source: CryptoQuant As you can see in the above graph, the indicator has now dipped to a value of 15. This is the lowest the metric has gone since July of the previous year. Related Reading | Start Of Bear Period? Current Bitcoin Trend Looks Similar To June Incidentally, the day in July when such low values occurred was also around when the Bitcoin price bottomed out. However, the quant in the post notes that this doesn’t necessarily mean that the current price has hit a bottom as well. Following the May crash, the months of May and June also observed similar extreme fear sentiments multiple times. So, it’s rather possible that the current low values of the indicator may persist for a while, just like back then, before the price finds its way back up. BTC Price At the time of writing, Bitcoin’s price floats around $42.4k, down 12% in the last seven days. Over the past month, the crypto has lost 16% in value. The below chart shows the trend in the price of BTC over the last five days. After the crash down to $42k a few days back, BTC’s price further plunged down to $41k yesterday | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com