Stablecoins are being withdrawn in record-speed from exchanges right now and most of them are being redeemed into dollar.

It is no secret that yesterday has been quite a FUD-ful day as we had a uncertainty around the SEC handing out a lawsuit against Paxos, the company behind Binance BUSD. This also lead to teh belief that the SEC may go behind every stablecoin as they are mostly unregulated and honestly a regulation in that field is long overdue after the scams we had last year. And this fear and uncertainty obviously also mirrored on the on-chain.

Here we just saw the highest amount of Stablecoin withdrawals EVER as there has been no occassion in the last three years that ewas even near that amount of stablecoin withdrawals. This is a completely new thing that has never happened in Crypto before and it will come with bad but also very bullish sides, especially for the long-term.

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Chart imported from Glassnode

As we can see here, the current withdrawals were huge and they seem to have kicked off just when this year began. Before that we just has high inflows of stablecoins into CEX but this turn of the tide is very welcome. You can also see that it was temporarily very bullish for us as those stablecoins were redeemed/converted into Bitcoin.

But right now the trend seem to be that most stablecoin outflows are being redeemed into USD which is quite unusual if we look at the past. Possibly also indicating how much fear there is around Stablecoins right now and it is good like that as stablecoins are in the eye of regulation and could be a real headache for Crypto going forward.