Stablecoin coinage data shows a slowdown in fiat-to-crypto ramps, with the Federal Reserve’s move likely to affect market activity, Matrixport warns.
Bitcoin (BTC) is likely to remain in consolidation as long as fiat-to-stablecoin conversions remain muted, according to Singapore-based digital asset company Matrixport.
In a research note of January 14, Matrixport noted that the last 7-day stablecoin The coinage indicator shows a “significant slowdown” in fiat-to-crypto on-ramps, especially in the beginning of the Christmas holidays.
Markus Thielen, an independent analyst, said the decline can be attributed to the Federal Reserve’s pivot in mid-December, which likely dampened investor sentiment. With fiat-to-stablecoin conversions still subdued, Bitcoin and other cryptocurrencies are expected to continue consolidating, Thielen warned.
Despite the end of the quieter holiday period, stablecoin inflows also showed a significant rebound. Even after the end of the holiday period, stablecoin inflows have also rebounded significantly. Thielen stressed that this metric is important, as an increase in stablecoin minting “typically signals a growing demand for cryptocurrencies.” However, the current increase in coinage is slight, and its sustainability remains uncertain, he admitted.
Thielen remains cautious, noting that while any increase in minting is a good sign, it is not enough to signal a clear path for BTC or other cryptocurrencies. For now, the market is likely to remain in a holding pattern until more significant movements in stablecoin flows appear.
Meanwhile, U.S.-based Bitcoin exchange-traded funds recorded their third consecutive day of outflows this year, as Bitcoin fell below $90,000 amid broader market risk sentiment. Like crypto.news reportedThe 12 spot Bitcoin ETFs recorded almost $285 million in net outflows on January 13, extending the outflow streak to three days, during which more than $1 billion exited the funds.
