CryptoQuant: If stablecoin reserves continue to decline, cryptocurrency liquidity may further tighten

A CryptoQuant analyst published an article stating that the recent crypto market has been continuously sluggish, with weakened demand for Bitcoin and other major assets. Data shows that the continuous decline in CEX stablecoin reserves (especially USDT and USDC) is a key reason for this trend. As a main source of market liquidity, the reduction in its reserves directly affects the purchasing power and market activity of cryptocurrencies. Since early 2025, this CEX's USDT and USDC reserve volumes have been decreasing weekly, indicating a decrease in market purchasing power, limited inflow of new funds, reduced buying pressure; which is consistent with Bitcoin's recent difficulty breaking through key resistance levels. The analyst believes that if stablecoin reserves continue to decline, cryptocurrency market liquidity may further tighten, delaying any significant upward trends. Conversely, if reserves rebound it could signal new fund inflows and demand recovery.