On March 29, a massive transfer of $1.4 billion worth of USDC, a fiat-backed stablecoin issued by Circle, moved to Coinbase, a leading crypto exchange.
Sharing a screenshot that appointment Based on data from CryptoQuant, the analyst said that the strong inflow could suggest that the bulls could be ready to inject capital. If that happens, major cryptocurrencies like bitcoin and ethereum could benefit.
Are bitcoin and ethereum Ready to Turn the Corner?
Looking at bitcoin and ethereum, it is evident that sellers could be in control, rejecting attempts to reach higher highs. bitcoin is trading below the $71,600 resistance level, marking March 28 highs.
On the other hand, ethereum has yet to fully capitalize on post-Dencun expectations of breaking $3,700. The coin remains under pressure, and there is a chance it could fall below $3,200 if the bulls do not return.
The analyst believes that the influx of USDC to Coinbase indicates a growing willingness of investors to enter the cryptocurrency market. Stablecoins have become the preferred conduits for traditional financial capital to flow into cryptocurrencies.
Popular stablecoins like USDT and USDC are backed by fiat money and can be redeemed for cash. Stablecoin inflows to the exchange are generally seen as a positive development, a net benefit for cryptocurrencies and, for the most part, leading assets.
Will history repeat itself? Past USDC inflows pushed price higher
Still, while prices could expand in the coming sessions, the fact that $1.4 billion was funneled into Coinbase cannot be the primary fuel. The cryptocurrency and bitcoin or ethereum markets are highly liquid, with sentiment or the large injection of money from institutions being mainly the main price drivers.
Still, general confidence is justified. This is not the first time that a massive USDC transfer to Coinbase has coincided with a cryptocurrency rally. In January 2023, the analyst gradesAn inflow of $1.3 billion in USDC to Coinbase preceded a price surge that saw the coin rises from around $16,300.
Therefore, taking into account this historical precedent, traders are optimistic and expect a possible recovery of bitcoin and ethereum.
USDC has been steadily gaining ground and is now poised to potentially dethrone XRP as the world's sixth most valuable cryptocurrency. According to data from CoinMarketCap on March 29, USDC has a market capitalization of $32.5 billion. On the other hand, XRP, the native currency of the XRP Ledger, has a market capitalization of over $34 billion.
Featured image from Canva, TradingView chart
