Bitcoin (BTC) Price Surges as Exchanges Received Large Stablecoin Deposits

Bitcoin has surged in the last 24 hours with its price recovering back to $57,000. Here's what could be behind this, according to on-chain data.

Bitcoin (BTC) has seen a 3% surge in the last 24 hours, bringing its price back up to $57,000. As Bitcoin observed this rally, new data has shown that a large sum of stablecoins entered exchanges on the same day.

According to market intelligence platform IntoTheBlock, new data has shown that a large amount of stablecoins entered centralized crypto exchanges on Monday, September 12. This الكبير netflow of stables into these platforms could have been linked to Bitcoin’s 3% rally.

On-Chain Metric Shows Large Stablecoin Deposits Were Made Into Exchanges Ahead Of Bitcoin Rally

A new post on X from IntoTheBlock covered the الكبير net stablecoin inflows into exchanges that have occurred recently. One indicator of relevance here is the “Exchange Netflow,” which indicates the net amount of a given coin or group of coins that is moving into or out of the wallets associated with centralized exchanges.

The indicator is calculated by taking the total amount of a coin that’s entering the exchange wallets and subtracting the total amount that’s exiting. The resulting value represents the netflow of the coin into these platforms.

Below is a chart shared by IntoTheBlock that shows the trend in the combined Exchange Netflow for all stablecoins over the past few months.

The indicator has shown الكبير net inflows of stables into exchanges throughout September. At the start of the month, the combined Exchange Netflow for all stablecoins stood at outflows of $100 million.

However, the metric quickly climbed out of the negative territory and has since shown الكبير net inflows. On the 11th, for example, the combined Exchange Netflow for all stables reached a high of $300 million in net inflows.

Stablecoin Exchange Netflows Imply Strong Demand For Bitcoin, Other Volatile Coins

The الكبير net stablecoin inflows into exchanges are being closely watched by crypto traders as they could be having an impact on the price of BTC and other volatile coins.

Generally, when هولدرز of coins transfer them from self-custodial wallets into exchanges, it is because they want to participate in trading activities. For coins like BTC, this selling can naturally have a bearish effect on the price, so positive Exchange Netflows can be considered a bad sign for the asset.

In the current case, however, the cryptocurrencies in question are stablecoins, which are different from the volatile coins as investors hold them for a different purpose.

Usually, the main reason هولدرز keep stables is to stay away from the volatility associated with the rest of the sector, as these tokens stay pegged around the same $1 value.

However, هولدرز of stablecoins do eventually plan to venture out into the volatile side of the market, though, as if not, they would have kept their capital directly in fiat.

When these investors feel the time is right to make this trade back into the volatile coins, they may transfer them to exchanges. This swap into BTC and others can naturally provide a buying boost to their prices, so positive stablecoin Exchange Netflows can in fact be a bullish sign for the volatile coins.

On the net, investors deposited around $300 million in stablecoins into the exchanges yesterday, implying that demand for buying into assets like Bitcoin may have been high.

Since then, BTC has observed a jump of more than 3%, which has taken it past the $57,000 mark. Given the timing, it’s possible that these stablecoin buyers had at least some role to play in the rally.

As such, the stablecoin Exchange Netflow could be to keep an eye on in the near future as well, since more net deposits could potentially mean a continuation of the surge for Bitcoin.

BTC Price

While BTC has made some recovery in the past day, its current price of $57,200 is still not near the levels it was trading at during the final week of August.

Bitcoin dropped below $50,000 during the first week of September, but bulls were able to quickly step in and halt any further downside. Since then, BTC has been able to climb back up to the mid-$50,000 range before making another push higher on Monday.

At the time of writing, BTC is trading up 3% at a price of $57,200. The seventh-largest cryptocurrency by market cap has seen a dull performance over the past week with gains of only 1%.

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