According to a report by the crypto custodian Copper, the month-on-month growth rate of stablecoins barely hit 1.5% by June 24. This is a big drop from the growth rates of over 5% we saw back in April and May.
Stablecoin leader Tether is having its lowest liquidity boost this year in June. At the same time, thereâs more talk about gold. Tether has even started offering a gold-backed synthetic dollar. It looks like everyoneâs searching for solid stability, even if itâs backed by gold.
Source: Copper
Itâs clear that money isnât flowing into the crypto markets like before. This is happening while Bitcoin and Ethereum are struggling, and the smaller altcoins are not picking up either.
Thereâs also a lot of anxiety about the possible listing of an Ethereum ETF. People are really wondering if the tokenomics will draw in investors. Since ETF investors canât get staking yields, the focus is now on how fast Ethereum is burning through its supply.
Copperâs Head of Research stated:
âThis indicates that less liquidity is moving into crypto markets as Bitcoin and Ethereum face downward pressures, and altcoins remain far behind with little hope of any significant rally in the short term. Bitcoinâs price is following a uniform path relative to these flows. Although this is not a measure of bullish demand, it indicates whether investors are less enthusiastic about offloading their Bitcoin at a discount, even if they anticipate a crash.â
Over the last 70 days, Ethereumâs supply has slowly increased, with an annual inflation rate of 1.39%âjust slightly below Bitcoinâs mining rewards.
Bitcoin remains on top
A report from Bybit covering December 2023 to May 2024 shows Bitcoin still rules, accounting for 26% of all assets users hold on their platform. However, the share of stablecoins has fallen sharply, from more than 50% in December to just under 43% by May.
Source: TradingView
Institutional investors are leaning more towards Bitcoin and Ethereum, seeing them as major assets. For instance, in May, institutional investors held 38.9% of their crypto in Bitcoin and 20.3% in Ethereum. Retail traders also prefer Bitcoin over Ethereum, though the difference isnât as big.
Jai Hamid