Stablecoin stagnation, tariffs a headwind for Bitcoin prices, analysts say

CoinTelegraph

by Zoltan Vardai

February 24, 2026

AI-Generated Deep Dive Summary

Global trade tensions and tariff-related anxieties have triggered a shift in investor behavior, with capital flowing out of cryptocurrencies and into safer assets like precious metals and tokenized commodities. This trend has raised concerns among analysts about the impact on crypto market liquidity and its broader implications for Bitcoin (BTC) and other digital assets. The stagnation in stablecoin supply is emerging as a significant hurdle, signaling that funds are being moved back into fiat currencies rather than reinvested within the cryptocurrency ecosystem. Stablecoins, which act as a key backbone for liquidity in the crypto market, have seen their supply drop by $5.6 billion year-to-date, falling from $159 billion on January 1 to $153.4 billion as of Tuesday. This decline is particularly notable on major exchanges like Binance, where stablecoin reserves have shrunk by 19% since November. Matrixport highlights that this stagnation indicates a lack of confidence or reduced activity within the crypto markets, as capital is being withdrawn rather than redeployed. The thinning liquidity in the crypto market is seen as a concerning sign for asset valuations, especially against the backdrop of growing global trade uncertainty. Investors are increasingly turning to safe-haven assets like gold and silver, further exacerbating the selloff in cryptocurrencies. This shift underscores the vulnerability of the crypto market to external economic factors and highlights the importance of stablecoins in maintaining market health. The combination of tariff shocks and stablecoin supply issues presents a challenging environment for Bitcoin and the broader crypto ecosystem. Analysts warn that these headwinds could hinder a recovery in prices, as reduced liquidity makes it harder for markets to stabilize or grow. For those invested in or following the crypto space, understanding these dynamics is crucial, as they highlight both the risks and potential long-term challenges facing digital assets. This situation also underscores the interconnectedness of global financial markets and how geopolitical tensions can ripple through even

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Originally published on CoinTelegraph on 2/24/2026