Messari CEO Says $3 Billion in Stablecoins are On the Sidelines
Digital currencies pegged to traditional assets such as fiat are known as stablecoins. Based on their design, they are capable of holding a steady value and provide cryptocurrency traders an easy means of escaping the high volatility of the cryptocurrency markets.
On April 17, the CEO of blockchain database startup Messari tweeted about the value of stablecoins on exchanges. Ryan Selkis said the massive sum of cryptocurrency capital are on the sidelines but ready to move into BTC, ETH, XRP and the greater altcoin markets.
In his words, he cited new data showing that crypto exchanges are currently holding more than $3 billion in stablecoins on behalf of investors. According to him, these investors are strategically positioned for re-entry into the speculative cryptocurrency market anytime.
“There’s now $3 billion++ of stablecoins sitting on exchanges. If investors wanted to cash out of crypto completely, they would have withdrawn funds to banks. Instead, we’ve got more dry powder held in the crypto economy than ever before. In both real and market cap % terms.”
In Nov. 2019, a report released by Binance Research regarding the habits of 69 high-net-worth investors with cryptocurrency allocations in a range between $100k and $25 million revealed some key information.
According to the results, 96 percent of those investors are using the stablecoin market. Tether (USDT) ranked as the leading stablecoin by a wide margin.
Interestingly, it is uncertain that these investors will do this as a means of avoiding fiat. It is unlikely that this massive sum will leave the cryptocurrency domain. Any movement will be into Bitcoin or any other cryptocurrency.
Despite the market crash that happened last month, cryptocurrency enthusiasts remain loyal. In fact, numerous whales acquired more coins after the crash. Maybe the sum on the sidelines is for the addition of more coins if there are more downsides prior to an upsurge. No one can tell what is going on.