Bitcoin Netflow And Stablecoins Supply Ratio Trends Look Similar To Q4 2020
As explained by an analyst in a CryptoQuant , two BTC indicators: the netflow and the stablecoins supply ratio, are both trending similarly to how they did during the last quarter of 2020.The Bitcoin netflow indicator shows the net number of coins entering or exiting exchanges. Its value is calculated by taking the difference between the outflows and the inflows.
The other metric of relevance is the stablecoins supply ratio, which is defined as the market cap of BTC divided by the market cap of all stablecoins.
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On the other hand, higher values of the ratio indicate a low supply of stablecoins, which implies a lack of buying pressure in the market. This could lead to a potentially bearish trend or sideways movement for BTC.The similarity between Q4 2020 and the current period | Source:As the above chart shows, the netflows seem to have been negative for a while now and the stablecoins supply ratio is also assuming low values.
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This trend looks to be similar to how it was during Q4 2020. What followed it was a big bull rally, and so the quant believes we may see BTC blow up similarly soon.BTC Price
At the time of writing, Bitcoin’s price floats around $43k, down 2% in the last seven days. Over the past month, the crypto has lost 9% in value.
Over the last few days, BTC has only shown sideways movement as the crypto fails to make a move above $45k. The below chart shows the trend in the price of the coin over the last five days:BTC's price continues to consolidate between the $40k and $45k levels | Source:
Featured image from Unsplash.com, charts from CryptoQuant.com, TradingView.com