A significant amount of capital is flowing from Stablecoins back into Bitcoin right now. This has usually been a pattern for a reversal and a prolonged rally.

One of the things that happen during bear markets is that a pretty big percentage of the capital in the crypto market does not flow completely out of it but into Stablecoins instead as people think its safer to reallocate assets until the bear market is over and then get back. Which makes sense as Stablecoins (mostly) will hold the value of your money and afterwards you will be able to enter the market at way lower prices.

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This had also happened this time, just after the top in November we saw the Stablecoin dominance massively rising and this time there was an even bigger rise due to the ongoing Stablecoins wars. But now the capital seem to be starting to rotate back into BItcoin, after over 13 months of Stablecoins dominance.

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Chart imported from Glassnode

This is the SSR Oscillator that measures the capital rotating between Stablecoins and Bitcoin during bull/bear markets. As we can see we are having the capital flow back into Bitcoin right now and the last times this happened it was a sign for a reversal and a bit more prolonged price rally. It happened during the start of the 2021 bull run, during the reversal from bear to bull in 2018 and even during the second top of $69k in 2021.

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Now, this metric does not exactly mean that we will be back to a bull market because as we can see in 2018 the reversal mean just a smaller bull market and in late 2021 it also just meant a smaller rally to a new ATH. But according to this metric it does seem clear that we will possibly have a decent rally going forward.