Recall that stablecoins are the key bridge between the world of fiat money and cryptocurrencies. Therefore, the growth in the total supply of such tokens suggests that large investors are turning to steiblcoin issuers like Tether or Circle, providing them with dollars and receiving newly issued blockchain-based coins in return.

Stablecoins are also used to preserve capital during market crashes. In addition, people in troubled economies use stable-value tokens to protect their savings and as an alternative to the dollar, which is not always available.

Bitcoin and the dollar struggle

Many analysts consider stablecoins to be the main application of digital assets and the key to their popularisation around the world. Therefore, an increase in the volume of Stablecoins in circulation is always viewed favourably within the industry.

What will cause Bitcoin’s rate to rise

However, this factor can hardly be considered as a self-sufficient basis for the formation of a full-fledged bullrun, according to the head of CryptoQuant Ki Ën Ju. While the overall supply of tokens with a stable price does continue to grow, this additional volume is not large enough to create significant liquidity on the buy side and drive up the price of Bitcoin.

On his Twitter page, Ju posted a graph with a metric of the ratio of exchanges’ reserves in BTC to reserves in stablecoins. The graph shows that trading platforms are currently holding almost six times more bitcoins compared to stablecoins. This is the image.

Ratio of Stablecoins to BTC in exchanges’ reserves

According to the executive, in September 2021, stablecoin reserves reached the 30 billion dollar equivalent mark, with the sphere of such tokens now capitalised at around $166 billion.

However, only 21 per cent of these stablecoins are stored on exchanges for the purpose of trading transactions. By comparison, in the same year of 2021, more than 50 per cent of the total volume of stablecoins was stored on exchanges. Here’s a rejoinder from a CryptoQuant spokesperson on the matter.

The scale of the stablecoin sphere is growing, but much of the new supply is being used for purposes other than trading on exchanges. Efirium and Tron-based steblecoins account for 92 per cent of exchange reserves, while BNB and Base only account for about 8 per cent.

Stablecoin reserves across different cryptocurrency networks

Ju noted the growing trend of using stablecoins as a means of capital preservation or for remittances.

According to Cointelegraph’s sources, more than 50 per cent of the total remittances sent to Venezuela, Argentina, Brazil, Colombia and Mexico between 2022 and 2023 are made up of stablecoins.

Top countries by inflation rate

This trend is observed in all regions of the world with high inflation rates. For example, Turkey has been identified by Chainalysis experts as the country with the highest share of Stablecoin purchases in relation to GDP.

Therefore, Ju concluded that liquidity from new inflows into cryptocurrency ETFs and user activity on Coinbase, the largest U.S. crypto exchange, will be “critical” to sustaining the market over the next few months. Accordingly, traders and investors should pay attention to this component.

Meanwhile, one of the most prominent representatives of the crypto industry Jordan Fish or Cobie shared his expectations for the future of the market. He believes that any outcome of the US presidential election will not prevent Bitcoin from reaching $100,000. Here is his comment.

Bitcoin will be worth more than $100K regardless of the winner of the election. Perhaps their outcome will only determine how fast it happens, and where else we go on the current journey.

Cryptocurrency investors

The legendary investor also suggests that the reason for such panicked comments is the inability of some players to wait for the right movement in the market.

It’s ridiculous to think as if BTC will never rise above $100,000 if the “wrong” president comes to power in 2025. This opinion seems to be more reflective of people’s personal rush to get rich than a real understanding of BTC or the markets.

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One of the reasons for the market not growing better in the long term is considered too strict regulations, which is primarily relevant for the US. And in one case they can damage the entire global economy – we are talking about restrictions on Bitcoin mining.

Recently, they are most often associated with the governments’ desire to care about the environment, as huge amounts of electricity are used to keep the BTC network running. Exponential Science analysts explained this correlation in a recent report as follows.

Well-intentioned policies can have unintended consequences. In particular, miners may simply move to regions with higher carbon emissions. Thus, bans on crypto mining in low-emitting countries can lead to an increase in overall carbon dioxide pollution.

Carbon dioxide emissions and electricity consumed by Bitcoin mining network

In other words, the Bitcoin mining process is powered differently in different countries. It is much more favourable for the environment when mining is supported in regions with access to renewable energy sources.

As an example, analysts mentioned Canada as a country that actively uses energy from hydroelectric and nuclear power plants. They continue.

Banning mining in Canada would result in the largest positive impact on carbon dioxide emissions, increasing the figure by about 5.6 per cent or 2.5 million tonnes of CO2 per year.

Earlier, authorities in the Canadian province of Manitoba extended a moratorium on new requests to state agency Manitoba Hydro for electricity quotas for mining companies. The extension of the policy also applies to new requests from miners.


Overall, the coin industry has enough tools to ensure the market grows going forward. However, the increased supply of stablecoins alone does not guarantee the coming stampede. Anyway, many people today are using such tokens to help their loved ones in other countries. So it is unlikely to count on such users buying BTC, SOL or other popular cryptocurrencies.


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