On-chain data reveals crucial metrics about the adoption of Bitcoin, stablecoins, and Cardano
In the new series report, DappRadar explores the value flow within the industry, starting with fiat money flows into the blockchain.
First in a bigger series of dAppradar’s reports, which explore how value moves around after entering the blockchain industry, revealed that the amount of Bitcoin (BTC) sitting in centralized exchanges (CEX) is at its lowest point in 2021, while Wrapped Bitcoin (WBTC), the first ERC20 token backed 1:1 with Bitcoin, doubled since the start of the year.
Besides tracking the flow of the main cryptos, the data acquisition and analysis company delved into how stablecoins, which are cardinal for interacting with decentralized finance (DeFi) protocols, affect the space.
Tracking Bitcoin and Ethereum
“Looking at BTC reserves, we calculate the reserve to circulating supply ratio at 12.67%, the lowest in 2021. The reserve to circulating supply ratio indicates the amount of the asset available in CEX compared to the total circulating supply,” read the report, while revealing that “there are more than 20,000 WBTC tokens locked in Ethereum (ETH) DeFi dapps.
Since the start of the year, the WBTC locked in these DeFi contracts has increased almost 100%, DappRadar revealed, pointing out that currently 1,1% of the largest crypto’s circulating supply has been wrapped.
Tracking the flow of the second largest crypto, the report revealed that the amount of Ethereum leaving CEX is at its highest, matching the highest supply of Wrapped Ethereum (WETH) used in DeFi.
“Overall, Ethereum’s value flow is not straightforward to map due to the different applications offered by the network. Whilst the value is apparently increasing on the DeFi side, it looks like a stronger trend is happening on the NFT sphere,” read the report, while underscoring that with approximately 7,069 million of WETH in circulation, around 6% of Ethereum’s total circulating supply has been wrapped.
Stablecoins and ADA
Four stablecoins, namely USD Coin (USDC), Tether (USDT), multi-collateral DAI and Terra’s native UST constitute 39% of the assets bridged in Ethereum, “pointing towards a hefty use in both DeFi and NFTs,” according to the report.
4 stablecoins; USDC, USDT, DAI, and UST constitute 39% of the assets bridged in #Ethereum, pointing towards a hefty use in both DeFi and NFTs.
What does this mean for the blockchain space?https://t.co/Fa5LJ5ZM2a
— DappRadar (@DappRadar) September 27, 2021
Stablecoin reserves on exchanges reached an all-time high of $19.52 billion, the report cited CryptoQuant’s data. As the metric represents almost a 500% increase from the start of the year, DappRadrar pointed out that exchanges currently hold around 15% of stablecoins market value.
To round up the largest four cryptos by market cap, DappRadar’s report explored the flow of Cardano’s native currency, ADA.
“For now, the main use of ADA is staking through delegation pools. Around 70% of ADA is staked,” read the report, citing Messari’s data.
“This means that, for now, most of ADA’s value will remain the same,” DappRadar added, pointing out that “around 2.45% of the market cap is likely to remain locked for future months.”
While concluding that “ADA surfaced as currently one of the most static assets,” DappRadar underlined that “the value flow proposition in ADA might change soon.”
The report reminded that Cardano’s smart contracts are expected to be fully functioning by 2022, which is expected to significantly affect the native token’s value story.
“We’ve yet to dig deeper to see which verticals the most established cryptocurrencies trickle down into, but one thing is certain: the top four cryptos have a clear path towards DeFi. As markets take a tumble, following the money sure is a comforting exercise if you’re into the wealth-generating segments that DeFi, NFTs and gaming are,” commented Modesta Jurgeleviciene, head of Finance and Research at DappRadar, while summarizing the findings of the report.