The Bitcoin Stablecoin Supply Ratio shows that investors today have more purchasing power than they did during the last bull run.
Bitcoin Stablecoin Supply ratio showing neutral purchasing power
The on-chain analysis firm has released its weekly report. Glassnode Has talked about the latest trends in the Stablecoin Supply Ratio (SSR) The supply of Bitcoin. The ratio of Bitcoin to the total supply is measured by this indicator. stablecoins.
The price of stablecoins is linked to the value of a fiat money. SSR is a tool that measures supply for stablecoins linked to US Dollars. Glassnode describes the importance of these assets in this sector:
They are now a key component of digital assets, and serve as the principal quote currency for trades across both centralized and decentralized platforms. They are a form of readily-available capital or “dry powder”, available for digital asset purchases.
SSR therefore compares Bitcoin’s supply with the available dry powder. In other words, it tells us about how the cryptocurrency compares against the investor’s purchasing power.
The value of this metric indicates that BTC’s supply is higher than the supply for stablecoin. In other words, the trader’s purchasing power is weak. The indicator is low, which means that there are high amounts of dry powder relative to BTC.
In the context of the current discussion, the SSR itself isn’t of focus, but rather a modified indicator called the SSR Oscillator. The analytics firm claims that the metric is a measure of “how the 200d SMA of the SSR moves within the Bollinger Bands BB(200, 2).”
This chart shows the Bitcoin SSR Oscillator’s trend for the last couple of years.
According to the graph shown above, Bitcoin SSR Oscillator was close to zero during the past few months. That means that investor buying power has been more or less equal to BTC’s supply.
From the chart, it’s visible that the trend was different during the rally Beyond $100,000, which occurred in late 2018. The SSR Oscillator then took a positive value, indicating that the stablecoin was not as plentiful compared to BTC.
SSR and the crypto are currently trading at similar levels, but the SSR tells a very different story. “Despite similar price levels, this shift suggests that investor purchasing power has improved markedly, reflecting stronger underlying demand conditions,”Notes the report.
BTC price
Bitcoin’s price is currently around $109 500, an increase of more than 2% over the past seven days.
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Source: www.newsbtc.com
