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Daily Bitcoin and Crypto Analysis

Daily Macro And Crypto Markets: Stablecoin Supply Reaches New Highs As Global Markets Turn Risk-On

November 4, 2021

Justin d'Anethan

The result of the Fed meeting is that the US central bank will start reducing its bond-buying program.

This means the quantitative easing should end by the middle of 2022, but the Fed did say they remained flexible. Perhaps surprisingly, most equity indexes rose because the comment was perceived as signaling strength and confidence in the economic recovery.

It seems that things are moving at a pace of their own in the crypto space but definitely enjoying the general risk-on tilt.

The thing that shocked me this morning is DOT. For the longest time, and I mean two to three years, my biggest allocations were BTC, ETH, and VET. And then DOT battled it out with ADA below. Now, I can see that DOT has blown past ADA and even just surpassed my VET allocation. There’s some massive strength here. 

It’s a dynamic you can observe with other coins, by the way. There’s an enthusiasm for a new generation of alts but with a different feel to the ICO craze of 2017. Coins like MATIC, TERRA, SOL, and MKR… People are looking at how they plug in or support the new blockchain ecosystem, and they’re gaining massive momentum.

This isn’t to take away from the majors that are definitely advancing and leading. BTC is currently hovering around $63,000, and ETH is steadily holding around recent new all-time highs of $4,600. Incidentally, I mentioned ADA earlier, and I’m still super bullish about this coin. It will just follow on its own time.

Something bullish for the space as a whole is the stablecoin supply which is hitting new all-time highs and suggests there’s just a ton of money (about 75 billion) sloshing around and ready to push crypto higher.

On the other hand, a chart from Glassnode tracks long-term holders and unrealized profit, essentially investor sentiment. And there is strength and capital, but prices are high, so profit-taking could push us back down for a revisit into anxiety, fear, and maybe capitulation.

On the news side and maybe more supportive, SEC is looking to schedule the Grayscale Bitcoin ETF conversion and could do it before December ends. From where I’m standing, with more products available to more investors, I think the pouring in of capital isn’t stopping anytime soon.

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