In October 15th, USDT has always been to the emergence of big diving price stability, the stability of other currency quickly seize the opportunity to occupy the market, and gradually increase the supply. Since October, the total supply of stable currency from $2 billion 100 million increased to $2 billion 540 million, to some extent alleviate the shortage of market liquidity problems.
But new problems appeared: stable money supply increased, in the end can not stabilize the price of bitcoin?
According to CoinMarketCap data show, we roughly compared to 10 months to 12 months of stable currency supply trend
(various stable currency growth trend comparison)
From 10 15 to 12 10 April, the market supply of USDC over 7 times, the total value of supply increased by $1.7 billion. An increase of $136 million over the same period, PAX. GUSD additional issuance of the value of 74 million 640 thousand tokens, supply increased by 513.9%. TUSD additional 5264 million, an increase of 33.5%.
However, the general rise in other stable currency market supply at the same time, the supply of USDT has been gradually falling, showing negative growth of 23.2%. The main reason is the 10 month of the black swan event, Tether redemption of a total value of $1 billion USDT, making its market supply from $2 billion 800 million to $1 billion.
Just a couple of months, stable currency once king USDT’s market share has decreased from 91% to 74%, stable currency other have achieved an increase. The biggest winner is USDC and PAX, from the beginning of the 1%, were up to now 8% and 7%.
(stable currency market share)
(stable currency supply trend)
Such as China of crypto currency strict regulation state, stable currency is money out of key encryption currency market.
In general, stable currency with special properties, increase market liquidity, to provide a safe haven for bitcoin fluctuations. If the currency stable negative emotional collapse, so will bitcoin prices more or less impact.
For example, Tether said before the redemption event. In mid October the bit currency price is relatively stable, reducing the supply of USDT did not immediately affect the price of bitcoin, but after mid bitcoin began to fall, when investors want to use USDT to avoid risks, but found on the market has been in short supply “USDT”.
This means that the investors to buy bitcoin less money, thereby increasing the downward pressure on the price of bitcoin.
Fortunately, since October, the total supply of currency stability has gradually increased to $2 billion 100 million from $2 billion 540 million, to enhance the liquidity of the market, can be said to be “not only, All flowers bloom together., zhengqidouyan” USDT outshines the. The revival of this one stable currency, whether can stabilize the price of bitcoin?
As we all know, although the supply of stable currency in circulation is increasing, but bitcoin is on the increase. When bitcoin prices fell, the miners will be action.
If the price of bitcoin is still above the psychological expectations, mining is still profitable, so most of the miners are more willing to hold bitcoin. However, when bitcoin prices continue to fall off near the currency price, so the miners will probably sell bitcoins to offset their mining cost.
From October 15th to December 15th for the time period, assuming that every 10 minutes to dig 12.5 bitcoin, dug up 1800 coins every day, we use bitcoin prices every day selling pressure is calculated with stable money supply or use of funds available for the circulation of every day.
The funding gap as shown below:
We can see from the chart, in bitcoin prices stabilized at more than $6000, stable currency bitcoin every day between the circulation and the daily supply gap still exists. Although there are fluctuations, but the overall gap is not.
In mid October and early November there was a large gap, this time node and a large number of USDT matched Tether redemption. At that time, the supply gap between stable coins and bitcoin expansion led to bitcoin prices fall further. After November 12th, this phenomenon has been improved, gradually narrowing the gap between two.
In other words, after November 12th, new day into stable currency market supply has been able to offset the bitcoin selling pressure.
Therefore, now bitcoin prices have also continued to fall, but if the supply of stable currency to maintain growth for a long period of time, then bitcoin prices may have a positive impact.