Author: Ana Paula Pereira, CoinTelegraph; Translated by: Deng Tong, Golden Finance
Supply growth of the Tether (USDT) stablecoin fell sharply in June, reflecting reduced liquidity in crypto markets.
A report from cryptocurrency custodian Copper shows that as of June 24, stablecoin supply grew by less than 1.5% month-on-month, a sharp drop from more than 5% in April and May. Fadi Aboualfa, head of research at Copper, said:
“This suggests that liquidity entering the crypto market is dwindling as Bitcoin and Ethereum face downward pressure, while altcoins remain far behind, with little hope for a significant rebound in the short term.”
Tether’s trading volume has plummeted from an all-time high of $767.22 billion at the peak of USDT trading activity on March 11 to $53.55 billion on June 24. USDT has a market cap of $113 billion, but the slowdown in USDT supply growth suggests less money is flowing into the cryptocurrency market.
USDT circulating supply. Source: Glassnode
According to Copper’s analysis, the Bitcoin market has seen a large outflow of funds every day recently, with more than $540 million leaving the market last week. In the past 30 days, the price of Bitcoin has fallen by more than 10%, from about $68,000 to about $62,000 at the time of writing. Aboualfa explained:
“As the market watches ETF dynamics, Bitcoin’s price follows a uniform path relative to these flows. While this is not a measure of bullish demand, it indicates whether investors are not too keen on selling Bitcoin at a discount, even if they anticipate a crash.”
BTC’s price has risen 37% since the exchange-traded fund (ETF) began trading in January. “Bitcoin is still trading within acceptable lows and highs relative to holdings, which suggests downward pressure,” Aboualfa said.
Market Macro Outlook
Cryptocurrency markets are under pressure from macroeconomic conditions. A June 25 report from ETC Group suggests that traditional financial markets have begun to “price in” global growth expectations.
"A key factor in the downward revision of global growth expectations is that US economic data has been disappointing relative to expectations," the analysis said.
The report noted that the Bloomberg U.S. Ecosystem Surprise Index, which measures the difference between actual macroeconomic data and forecast data, has fallen to its lowest level since 2019. “This decline reflects a widespread recognition that the macroeconomic environment is deteriorating.”
ETC Group said that continued downward revisions to global growth forecasts, coupled with rising risks of a U.S. recession, could continue to pose challenges to Bitcoin prices.
