Key Takeaways
What does the rising supply of stablecoins show us?
ERC-20 stablecoin supply surpassed $250 billion and approached nearly $50 billion on Binance alone, showing that investors could be getting ready to enter the market.
Does this mean the market could see a recovery?
The SSR oscillator answers this more definitively. The trends of the past three years show that Bitcoin could form a new bottom and then recover.
Bitcoin [BTC] October 2025 was not as bullish as expected at the end of September. At the time, it was expected that the choppy Bitcoin price action in the $108,000-$117,000 range would be swept aside and a real “Uptober” would begin.
Global economic uncertainty and a major cryptocurrency liquidation, the 10/10 crash, have ‘structurally derailed’ any momentum the Uptober story was building.
It was the worst October in ten years. Bitcoin was again hovering around $110,000 at the time of writing.
Are there signs that this balance will change?
What Could Catalyze a Bitcoin Momentum Shift?
In a message at CryptoQuantanalyst Donkerfost emphasized that purchasing power is tied to the availability of liquidity, or stablecoins.
The total supply of stablecoins rose rapidly and exceeded $250 billion. On Binance alone, the supply of ERC-20 stablecoins amounted to $48.8 billion.
Despite the shaky, fearful market conditions and price action, the rapidly increasing stablecoin supply suggested that investors were preparing to enter the market.
The Stablecoin Supply Ratio (SSR) – Bitcoin’s market capitalization divided by stablecoin market capitalization – supports this view.
THIS indicates high purchasing power
The SSR oscillator has fallen deep into negative territory, showing that stablecoin liquidity is greater than Bitcoin’s current valuation. Historically, such measurements corresponded to the bottoms of local markets.
Furthermore, these price bottoms were not immediately visible, but took some time to materialize. This could dampen investor expectations based on the price action in recent months.
Binance Stablecoin Netflows had a five-day streak of positive flows. The highest inflow was $1.6 billion on October 31.
It was another sign that investors could be positioning themselves to enter the markets.
While signs have pointed to a potential market bottom, we should remember that this is no guarantee of a market turnaround. Such a reversal would also not happen immediately, so traders and investors should temper their bullish expectations accordingly.