„Giga-pump is coming“ – Bitcoin trends show: Huge capital is waiting to get into BTC

Leisl Eichholz, an analyst at blockchain analytics platform Glassnode, listed a number of bullish indicators for bitcoin, including a so-called stablecoin supply ratio (SSR), which signals an imminent rally in the cryptocurrency market. In retrospect, SSR is the ratio between the supply of bitcoin and the Bitcoin Profit supply of stablecoins, denominated in BTC.

Glassnode notes that when SSR is low, current stablecoins have more purchasing power to buy bitcoin. Conversely, a high SSR reflects an emerging selling pressure in the bitcoin market.

„BTC’s SSR is down in 2021 as more stablecoins are minted,“ Eichholz said in her weekly note to clients. „When SSR is low, it means there is a large supply of stablecoins relative to BTC, indicating more buying power ready to flow into BTC and other assets.“

Tether FUD

Earlier, journalists had raised further questions about the credibility of Tether’s USDT – a stablecoin that covers around 80 percent of all bitcoin trading across all exchanges. Its supply cap recently passed the $26 billion mark, which should mean that iFinex – Tether’s parent company – needs to hold $26 billion in its accounts to maintain the dollar peg.

Nonetheless, the company has so far avoided third-party audits. It remains embroiled in a legal controversy with the New York Attorney Journal for allegedly mishandling clients‘ funds and failing to back its USDT supply with actual dollars.

„No government agency oversees Tether and makes sure they behave properly, which is why Tether and its sister company Bitfinex have been doing whatever they want for years,“ comments independent journalist Amy Castor.

 

But bitcoin bulls have ignored the Tether controversy so far. The stablecoin continues to get traction across exchanges to make trading easier and faster. This somewhat supports Glassnode’s SSR indicator to predict the next trend.

A massive amount of USDT – whether supported or not – is waiting to enter the bitcoin market.

„Many of these newly minted stablecoins are deposited on exchanges, which means they are highly liquid and ready to buy up assets like BTC,“ Eichholz said.

Other on-chain indicators available on Glassnode show that bitcoin (Go to Plus500 buy bitcoin guide) is in a healthy state. These include a tool that tracks BTC balances on cryptocurrency exchanges.

A higher value shows that more traders are depositing their BTC units to sell later. Conversely, a lower reading reflects the so-called HODL sentiment – a meme version of the word „hold“.