[Analysis] Exchange stablecoin inflows surge…"A sign of market liquidity recovery"

Minseung Kang

Summary

CryptoQuant said that recent net inflows of stablecoins to exchanges have increased significantly.
This suggests investors' liquidity is returning to the market and is similar to flows seen just before past price spikes, analysts said.
However, they projected that selling pressure from long-term holders remains, and if this imbalance is resolved, the market could recover faster than expected.

An analysis has found that recent inflows of stablecoins to crypto asset (cryptocurrency) exchanges have been rising sharply. This suggests that investors' funds waiting to buy risk assets are moving again.

On the 8th (local time), a Darkfost analyst at on-chain data analytics firm CryptoQuant said in a QuickTake report, 'Net inflows of stablecoins to exchanges have clearly increased in recent weeks,' and 'this shows that liquidity in the market remains intact.'

According to CryptoQuant data, Binance-based cumulative monthly net inflows of stablecoins surged from $1.7 billion to $8.8 billion in two weeks. Analysts say this is a pattern similar to the flow observed just before Bitcoin (BTC) recorded an all-time high (ATH) at the end of September.

The analyst explained, 'At the time in December 2024, Binance's stablecoin net inflows exceeded $13 billion,' and 'historically, large inflows tend to precede a broad expansion in market buying or a rekindling of speculative demand.'

He added, 'Exchange inflows of stablecoins mean that investors are allocating funds in preparation for future purchases of risk assets, reflecting anticipation and conviction,' and 'in part, it could be the effect of exchanges increasing their own reserves to meet user demand.'

However, he said, 'Although inflows are strengthening, pressure from selling by long-term holders remains significant,' and 'if this imbalance is resolved, the market could enter a recovery phase faster than expected.'

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