A new group of sheriffs has taken command of the cryptocurrency market, and contrary to appearances, they are not at all the issuers of spot ETFs. Indeed, the cards are being dealt by the entities behind the largest stablecoins, which play an important role in the sector. At least, that's according to analytics firm 10x Research, which points to recent changes in the digital asset landscape.

In the past 30 days, the supply of the two largest stablecoins in terms of marketcap has increased by $10 billion. This, in turn, represents double the amount of funds from what has flowed into spot bitcoin price-tracking ETFs

Analysts at 10x Research suggest keeping a closer eye on indicators for this asset class than whether a certain level of capital is flowing into or out of cryptocurrency-related exchange-traded funds

Stablecoins will tell you how it is, not ETFs

The dynamic increases on the bitcoin price chart have actually been going on since October 2023. That's when the cryptocurrency market's euphoria over potential SEC approval of spot ETFs began to take hold. January brought us the approval of the US regulator and the launch of such exchange-traded funds. Since then, the price of BTC has risen by 60% as billions of dollars of capital from institutional investors began to flow into issuers.

News sites focusing on this market often analyze whether the last few days have brought another wave of inflows of funds to bitcoin ETF issuers or whether institutional investors are nonetheless abandoning this type of allocation to bitcoin.
Analyst firm 10x Research, however, points out that following ETFs does not reflect the actual state of demand in the cryptocurrency market. What really provides an indicator that gives a good picture of what the current mood is among this community relates to changes in the supply of key stablecoins.

We suggest paying less attention to bitcoin ETF flows. Stablecoin issuers are the new sheriff in town, driving the market upward
- states Markus Thielen, founder of 10x Research, in a new report.
Indeed, from it we learn that in the last 30 days the supply of USDT tokens from Tether and USDC tokens from Circle has increased by a combined total of nearly $10 billion. As for the smaller projects in this segment of the market, DAI issued by MakerDAO and FDUSD from First Digital also saw an increase in supply in the range of 5 to 10% during this period.
The largest of the stablecoins in terms of market dominance, the aforementioned USDT, rose by $2.4 billion over the past seven days. Such a jump in supply represents one of the largest weekly readings in a bull market.
Fiat money is being moved into cryptocurrencies at an accelerated pace. The stablecoin bump is doubled and, unlike ETFs, can only have exposure to the long term
- adds the analyst.
In contrast, only $5 billion has flowed into US exchange-traded funds (ETFs) focused on bitcoin over the past 30 days.