The crypto market woke up on Friday to fresh evidence that the liquidity powering the last two crypto rallies has not only returned, it has grown, and this time the clearest sign isn’t in the slow-moving money aggregates but in stablecoins. CryptoQuant’s latest quicktake shows ERC-20 stablecoin supply has climbed past $160 billion in 2025, a fresh all-time high that the analytics firm says better captures real-time capital flows into crypto than conventional measures like M2.

That development comes as Bitcoin trades back above the $90,000 mark after a bruising month. Major price trackers put BTC near $91,000 on Friday, recovering from a late-November slump that briefly took the coin into the low $80,000s. The rebound has drawn competing reads from market observers: some see momentum building toward prior highs, while others warn that on-chain indicators point to lingering downside risks.

CryptoQuant’s argument is straightforward: broad measures of money supply, such as global M2, set the macroeconomic backdrop but move slowly and don’t always match Bitcoin’s near-term swings. The firm points out the 2020–21 surge in M2 coincided with Bitcoin’s massive bull run, but over the last five years, the statistical correlation between global M2 and BTC has averaged only about 0.5, strong enough to matter, but not precise enough to trade from. During tightening periods like 2022–23, Bitcoin often behaved independently of M2.

Stablecoins, by contrast, act as crypto’s on-ramps and trading fuel. CryptoQuant notes that total ERC-20 stablecoin supply expands and contracts rapidly, reflecting investor intent to enter or exit crypto markets, to provide liquidity on DEXs, or to back institutional flows and ETFs. In both the 2021 bull market and the market recovery seen across 2024–2025, increases in stablecoin supply preceded upward moves in Bitcoin, the report says, which is why today’s record is getting attention.

Price action this month has been volatile. Bitcoin reached an October record above $125,000 before surrendering a large chunk of those gains in November; some data providers logged a fall of more than $40,000 in roughly six weeks as traders digested profit-taking, macro uncertainty, and spikes in exchange inflows. That volatility is exactly the context in which CryptoQuant argues stablecoin supply shines: it’s a quicker, more direct reflection of buying power than monthly M2 snapshots.

Not everyone is reading the tea leaves the same way. Several analyst notes this week flagged short-term technical and on-chain stress. QCP Asia and others warned the market had entered an “extremely bearish” phase at one point in November, pointing to exchange inflows and on-chain selling pressure that could push BTC to lower support levels if momentum fails to recover. Those warnings temper the otherwise bullish narrative that more dollar-pegged tokens in circulation necessarily mean immediate price gains.

Still, the mechanics make intuitive sense for traders and portfolio managers: more stablecoins on-chain means more dry powder that can be deployed into places where liquidity matters fastest, centralized spot markets, margin desks, lending markets and decentralized exchanges. If that dry powder is converted into buy orders, it supports higher prices; if it stalls as holders wait on the sidelines, momentum can dissipate. CryptoQuant highlights this speed advantage repeatedly in its note.

For investors watching the interplay between macro liquidity and crypto flows, the message is twofold. The slow-moving macro expansion, driven this year by expectations for rate cuts in the U.S., fiscal and stimulus measures elsewhere, and a generally easier liquidity backdrop, provides a permissive environment. But the immediate, tradable signal is domestic to crypto: watch the stablecoin balance sheets.

Where they rise, CryptoQuant says, underlying buying power is strengthening; where they flatten, momentum is likely to cool. What happens next will likely depend on how quickly that on-chain buying power converts to bids at exchanges and whether macro headwinds, chiefly U.S. rate policy and episodic risk-off moves in global markets, inject fresh volatility.

If BTC continues its recent climb toward prior peaks, analysts who point to record stablecoin supply will claim vindication. If price weakness resumes despite abundant stablecoins, it will raise fresh questions about whether those coins are waiting on the sidelines or being used in liquidity strategies that don’t push spot prices as strongly as in prior cycles.

For now, the record stablecoin total is a reminder that crypto has its own plumbing, one that often reveals intent faster than traditional macro statistics. Traders will be watching both the balance sheets and the order books to see whether this new wave of liquidity becomes the fuel for another leg up, or simply a parked pool of capital waiting for a clearer catalyst.

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