Markets
The cryptocurrency market is missing a key ingredient to fuel a sustained price rally, the analyst firm says
Despite some bullish developments, the digital asset market is still missing a key ingredient critical to fueling a sustained price rally, according to analytics firm CryptoQuant.
CryptoQuant Notes that demand is increasing for Bitcoin (Bitcoin) and Ethereum (ET).
“Bitcoin demand growth from permanent holders added 70,000 Bitcoins in the last 30 days. Demand from large investors is growing by 4.4% month-on-month. Additionally, large investors are injecting $1 billion per day in Bitcoin, similar to 2020 pre-rally activity…
Demand for Ethereum has also increased. After May 20, demand for ETH increased due to spot approvals of ETH ETFs in the United States. Daily purchases by permanent holders have risen to 40,000 ETH, with large investors holding 16 million ETH.”
Source: CryptoQuant/X
However, CryptoQuant Notes Stablecoin liquidity needs to recover to fuel a sustained cryptocurrency rally.
“Tether USDT market capitalization growth, an indicator of new liquidity in cryptocurrency markets, has continued to decelerate and is now growing at the slowest pace since February 11. Price gains are generally accompanied by a acceleration in stablecoin liquidity growth.”
Source: CryptoQuant/X
USDT it is the leading stablecoin by market capitalization and aims to maintain a 1:1 peg to the US dollar.
At the time of writing, Bitcoin is trading at $70,812 and is up nearly 4% over the past seven days.
ETH trades at $3,809 and is up 1.5% over the past week.
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