The cryptocurrency market is undeniably in a deadlock between bullish and bearish sentiments regarding the near-term outlook. Bitcoin price continued to fluctuate between $31,000 and $30,000 without a clear bullish stance. Consolidated over the past three weeks, experts believe it is only a matter of time before a Bitcoin breakout happens in both directions, which should provide a better perspective for the altcoin market.
However, there is another way to look at the market by studying the behavior of major stablecoin holders, even though they belong to exchanges.
Stablecoins Behavior in Relation to Bitcoin Price Action
According to market intelligence platform Santiment, the two largest stablecoins, Tether USDT and Circle USDC, contain a lot of crucial information in decoding the Bitcoin market. From the fundamental standpoint that a decrease in stablecoins reserve amid a rising Bitcoin price is extremely bullish and vice versa, it is then easier to predict the outlook for the crypto market.
According to the Santiment stablecoins study, the whales and sharks are showing a bullish outlook as their supply decreases on exchanges amid the recent Bitcoin spike. The report further noted that more stablecoins remained on exchanges, which could mean that traders are interested in buying crypto assets.
“Contrary to how similarly the top 10 largest addresses for both assets match total supply on exchanges, it is safe to say that most of the largest addresses are on exchanges right now,” Santiment closed.
