Stablecoins Vanish: Is Crypto Doomed?

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Right. So, it appears a rather significant quantity of digital money, invented specifically to not be particularly exciting, has decided it’s even less excited than previously thought. We’re talking about stablecoins. These are, as the name suggests, those cryptocurrencies desperately clinging to the notion of being worth a fixed amount of, well, actual money. Mostly US dollars, because why bother with anything sensible like the Mauritian rupee?

The Great Stablecoin Disappearance

Apparently, according to someone called Darkfrost, who sounds like a moderately disgruntled weather forecaster, these stablecoins have been experiencing “outflows”. Frankly, one assumes they’ve simply decided to take a holiday. Possibly to a less volatile jurisdiction. Possibly to a server farm in Antarctica. One doesn’t ask too many questions.

The idea, you see, is that when people get twitchy about the wildly unpredictable nature of Bitcoin (and let’s face it, wouldn’t you get twitchy if your assets fluctuated more than a particularly excitable jellyfish?), they park their funds in these stablecoins. A sort of digital waiting room, if you will, filled with people nervously clutching their wallets and muttering about market corrections. Then, when the coast is clear, they leap back into the thrilling chaos of cryptocurrency trading. Except, it seems, they aren’t leaping. They’re… leaving.

We’re focusing on the ERC-20 variety, which are the ones that hang out on the Ethereum network – a place already well-known for its slightly confusing rules and exorbitant transaction fees. Think of it as the Monaco of blockchains. Nice to visit, expensive to live in.

As the bafflingly complex graph above demonstrates (note the subtle use of colours), the stablecoin supply enjoyed a brief period of apparent prosperity in 2025 – which now feels like a lifetime ago, doesn’t it? – before settling into a state of sullen stagnation. Like a beige-coloured room.

But hold on. It gets worse. In the last week, a staggering $7 billion has simply… vanished from the stablecoin market cap. That’s a lot of digitally-represented dollars. One suspects it’s been sucked into a black hole, or possibly diverted to fund a particularly lavish cryptocurrency convention.

Now, naturally, everyone’s looking at Bitcoin. The theory is that people are exchanging their stablecoins for the original cryptocurrency. Except Bitcoin’s price has also, rather inconveniently, decided to wobble a bit. This suggests, and here’s the truly terrifying part, that people are simply giving up on the whole thing and exchanging their digital assets for… actual, physical money. The horror.

According to Darkfrost (still sounding remarkably calm, all things considered):

This is a very negative signal, explained by the fact that some investors are choosing to fully exit the crypto market, which continues to correct, while precious metals keep surging and equity markets maintain a strong underlying uptrend.

In other words: people are realizing that gold and the stock market are, surprisingly, less likely to disappear overnight. Who knew?

This is, apparently, the first time this particular brand of digital panic has occurred in this cycle. Whether it’s a blip, or the first sign of the entire house of cards collapsing, remains to be seen. Either way, stock up on tea and biscuits. You’re going to need them.

BTC Price (Because Apparently We Still Need To Talk About It)

Bitcoin, in a desperate attempt to seem nonchalant, has had a minor bounce back to $88,300. Which is… something. Don’t get excited.

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2026-01-27 11:10