Stablecoin market drop signals shift to gold over Bitcoin Santiment says

A sharp $2.24 billion fall in stablecoin market capitalisation over the past 10 days suggests capital is leaving the crypto ecosystem, according to Santiment.

The analytics firm said investors appear to be rotating funds into traditional safe havens such as gold and silver rather than digital assets.

“A falling stablecoin market cap shows that many investors are cashing out to fiat instead of preparing to buy dips,”

Santiment said.

Santiment added that rising demand for gold and silver indicates investors are prioritising safety over risk during periods of uncertainty.

Bitcoin has fallen nearly 30% since a major market crash in October, while gold has climbed more than 20% to above $5,000 per ounce.

Silver has more than doubled in value over the same period as crypto assets retraced.

Santiment said stablecoin growth is typically a prerequisite for a sustained crypto market recovery.

“Historically, strong crypto recoveries tend to start when stablecoin market caps stop falling and begin to rise again,”

Santiment said.

The firm warned that until stablecoin supply rebounds, smaller and riskier altcoins are likely to face continued pressure.

At the time of reporting, Bitcoin price was $88,585.13.