Bitcoin's price rose above $97,000 on Friday as the stablecoin market recorded a new flow of liquidity.
The market capitalization of the stablecoin market grew by $5 billion in April, an increase of 2.2% to reach $238 billion.
The market capitalization of both USDT and USDC rose by $2.5 billion and $1.2 billion over the past week.
Bitcoin's price (BTC) rose above $97,000 on Friday as the leading cryptocurrency appeared to be gearing up to reclaim the $100,000 level with the weekend approaching. The rise was fueled by increased inflows into the stablecoin market last week, particularly from USDT and USDC, which added $2.5 billion and $1.2 billion to their market capitalizations, respectively.
Bitcoin rises as the stablecoin market sees new inflows
The market capitalization of the stablecoin market saw an increase of 2.2% in April, reaching $238 billion. The rise was fueled by inflows of USDT and USDC last month.
Leading stablecoins saw an increase in their market capitalization just last week. The market cap of USDT increased by $2.5 billion, while USDC saw an increase of $1.2 billion.
The market capitalization of USDC grew by 3.07% to a record level of $62.1 billion in April, pushing its market share to 26.0% — the highest level since February 2023, according to CoinDesk's stablecoin report.
On the other hand, the market capitalization of USDT increased by 2.26% to $148 billion, marking its twentieth consecutive monthly increase. Its market share also saw a slight increase from 61.8% to 61.9%, while its trading dominance on centralized exchanges reached 75.2% of the total volume of stablecoins.
The increase in stablecoin liquidity indicates a strong flow of capital into the cryptocurrency market. Historically, increases in the market capitalizations of stablecoins have aligned with Bitcoin price gains, reflecting increased liquidity and capital availability. The recent growth in USDT and USDC supports this trend, bolstering upward pressure on Bitcoin, according to a report on Friday from CryptoQuant.
CryptoQuant stated: "The 30-day expansion in the market capitalization of USDT and USDC is now above the trend again, which is historically linked to rising Bitcoin prices."
Bitcoin's price rose above $97,000 early Friday amid a slight recovery in the cryptocurrency market over the past week.
Long-term Bitcoin holders (LTH) accumulated 254,000 BTC at an average price of $95,000 since the recent low, indicating strong conviction and minimizing risk, according to Glassnode.
Additionally, Glassnode highlighted that short-term Bitcoin holders (STH) who held BTC for more than a month have returned to profit. Continued this trend could reduce selling pressure from older STH holders and indicates the early stages of an uptrend.