$9.3 Billion in Stablecoins Flow into Crypto as Bitcoin Surges

After a massive $9.3 billion in stablecoins flowed into crypto exchanges, Bitcoin’s price hit a new high, just below $77,000. Investors seem to be gearing up for a new phase in crypto under Trump’s presidency.

Stablecoin Deposits Spike After Election

Following Trump’s win and a recent interest rate cut by the Federal Reserve, stablecoin deposits on exchanges spiked. CryptoQuant reports that $9.3 billion in ERC-20 stablecoins flooded into major exchanges, with Binance and Coinbase leading the pack, receiving $4.3 billion and $3.4 billion, respectively.

ERC-20 Stablecoins: Digital currencies tied to stable assets (usually the U.S. dollar) and issued on the Ethereum blockchain.

Stablecoin Inflows Often Signal Bitcoin Rallies

Large stablecoin deposits often indicate a potential Bitcoin rally. This trend has happened before, like in 2021 when a stablecoin influx helped drive a major Bitcoin bull run. A similar increase earlier this year also pushed Bitcoin to new highs ahead of the Bitcoin halving.

Strong Optimism for Bitcoin

There’s a lot of optimism around Bitcoin’s potential. QCP Capital, a crypto investment firm, expects Bitcoin’s positive momentum to keep going into 2025. They think Trump’s proposed tariffs on China and the rising U.S. debt might make Bitcoin a safer bet than traditional stocks, as it could carry a lower “risk premium.”

Risk Premium: The extra return investors seek to compensate for taking on higher risk compared to lower-risk investments.

U.S. Demand for Bitcoin Is Rising

On November 6, the Coinbase Premium Index, which tracks Bitcoin demand in the U.S., jumped, showing increased U.S. interest. This also coincided with heavy inflows into Bitcoin ETFs, especially BlackRock’s IBIT, which saw $1.1 billion in new investments on November 7, its largest inflow since January.

With Trump’s potential impact on crypto policy, investors are watching closely, expecting continued growth in Bitcoin and the broader market.