Investors Show Confidence in BTC & ETH During Risk-Off Market
• Despite current risk-off sentiment, investors signal confidence holding BTC and ETH on exchanges over stablecoins.
• Glassnode data analyzed by CryptoSlate suggests that investors are confident holding Bitcoin and Ethereum, over stablecoins, during the current risk-off environment.
• BTC and ETH purchasing power on exchanges has increased relative to stablecoin buying power, suggesting there is greater stablecoin-denominated buying power in proportion to BTC and ETH buying power.
Despite the current risk-off sentiment around the crypto market, investors have signaled their confidence in Bitcoin and Ethereum by holding them on exchanges over stablecoins. Data analyzed by CryptoSlate suggests that investors are confident in their holdings of Bitcoin and Ethereum during the risk-off environment.
The data shows that the buying power of BTC and ETH on exchanges has increased relative to stablecoin buying power. This suggests that there is a greater stablecoin-denominated buying power in proportion to BTC and ETH buying power. This could be attributed to the billions of stablecoins that have been redeemed for fiat in recent months, particularly due to the Binance insolvency FUD.
Stablecoins fulfill multiple functions in the crypto market, including facilitating on/off ramping and as a store of value, particularly in Southern Hemisphere countries that typically experience high inflation. This explains why investors have been more cautious in the current risk-off environment, by holding Bitcoin and Ethereum on exchanges over stablecoins.
However, these on-chain metrics offer an insight into investor confidence, signaling that they have faith in the long-term potential of Bitcoin and Ethereum. This could potentially be a sign of a positive trend in the coming months, as investors continue to trust in the power of cryptocurrencies.