Stablecoin Inflows Rebound After Four-Month Outflow Streak, But Momentum Cools Rapidly

After nearly four months of continuous outflows, stablecoin net flows have finally turned positive. The 30-day average of net inflows moved into positive territory for the first time since May, ending a 113-day streak of net outflows from exchanges.

However, on-chain analyst Axel Adler Jr. warns that this rebound is rapidly losing momentum, suggesting the broader market signals remain neutral.

Stablecoin Net Inflows Improved, Then Cooled Fast

Stablecoin net inflows officially turned positive on September 1, as the 30-day average of ERC-20 stablecoin flows to exchanges climbed above zero. The day saw net inflows totaling $13.85 million, marking the first positive reading in nearly four months.

However, this rebound has weakened rapidly. Within just two days, net inflows plummeted from $13.85 million on September 1 to $6.85 million by September 3, representing a sharp 51% decline.

Bitcoin’s Stablecoin Buying Power Is Improving, but Slowly

Another key metric tracked by Adler is Bitcoin’s Stablecoin Supply Ratio (SSR), which indicates a modest improvement in the buying power of stablecoins relative to Bitcoin, though the recovery remains limited.

The SSR metric compares Bitcoin’s market value against the total supply of stablecoins, serving as a gauge for potential buying power. A lower SSR generally indicates that stablecoins possess greater purchasing power relative to Bitcoin.

The SSR fell from its August highs, suggesting that stablecoins have regained some relative buying power. On September 1, the ratio stood at 13.84, while its 90-day, 200-day, and 365-day oscillators remained above zero at +0.215, +0.249, and +0.162, respectively. All three metrics have declined from their peaks on August 26.

According to Adler, these readings suggest that stablecoin buying power is indeed improving, but it has not yet returned to its recent trend.

“Exchange flows are no longer clearly negative, while the SSR is retreating from its recent local high. However, neither metric confirms a sustained expansion in liquidity just yet,” Adler noted.

What Would Confirm a Liquidity Reversal?

Adler explained that a sustained liquidity reversal would require two key conditions: an expansion in net inflows and a further decline in the SSR oscillators.

If inflows continue to increase, the data will provide stronger evidence that liquidity is actively returning to exchanges. Conversely, if exchange net flows turn negative again, the September shift could prove to be merely temporary.

Why This Matters

Positive stablecoin inflows signal that more liquidity is moving onto exchanges and is potentially available to buy crypto assets. If these inflows continue to grow, it will strengthen the case that market liquidity is successfully recovering after months of persistent outflows.

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