As Bitcoin (BTC) is trading for $28,502 at the time of writing, prominent crypto analytics platform Santiment is taking a closer look at what factors could drive a bullish rally. According to the firm, the market caps of stablecoins such as Tether (USDT), USD Coin (USD Coin), Binance USD (BUSD), Pax Dollar (USPD), and Dai (DAI) could be an indicator of Bitcoin on the rise. Santiment claims that the combined buying power of the top five stablecoins stands at $126.31 billion, which is more than double its value in March 2021.

At the same time, Santiment indicates that some of the larger Bitcoin entities may be starting to take profits. Last week, the analytics firm revealed that the five largest Bitcoin transactions in 2023 all happened in March, suggesting that large BTC holders may be cashing out their assets. While this could indicate a slow-down in the BTC rally, Santiment argues that the growth of the stablecoin market cap is indicative of the prospect of Bitcoin rising in value.

The analytics firm emphasizes that traders need to keep a close eye on the market caps of the top five stablecoins and a rise would signal a higher likelihood for Bitcoin rising. Santiment states that the sustained uptrend of Bitcoin is known to correlate with the growth in crypto-collateralized stablecoins. The growth of the crypto-backed stablecoin industry suggests that traders may be shifting from speculation to more long-term capital commitments.

Overall, Santiment suggests that watching the market caps of the top five stablecoins could be a good indicator of the future of Bitcoin and whether or not it is heading for a rally. If the market caps for the stablecoins are on an uptrend, traders can take that as a positive sign for Bitcoin to skyrocket. However, if the larger Bitcoin entities continue to take profits, traders should exercise caution while operating in the crypto space.



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