The price of Bitcoin (BTC) has extended its recovery on Jan. 14, reclaiming the $38,000 level. What’s more, the weekly candle has now turned green for the fifth consecutive week despite the 28% crash earlier this week.
BTC/USD Weekly candle chart (Bitstamp). Source: Tradingview
Meanwhile, stablecoin deposits are flooding into cryptocurrency exchanges, according to data from CryptoQuant. This inflow may act as a short-term catalyst for Bitcoin as it suggests that sidelined capital is moving back into BTC.
Stablecoins inflow on exchanges. Source: CryptoQuant Why are stablecoins indicative of strong buyer demand for Bitcoin?
In the cryptocurrency market, many traders sell crypto assets, like Bitcoin, to stablecoins rather than cash.
Stablecoins, such as Tether (USDT), is pegged to the value of the U.S. dollar and are tradable across exchanges.
Most exchanges require a complicated Know Your Customer (KYC) verification process for bank transfers, and cash deposits into exchanges could take a long time.
As such, if a whale or