Bitcoin's Liquidity Drought: A Barrier to Rally

Bitcoin's recent struggles to rally can be attributed to a lack of liquidity in the market, rather than a loss of faith among holders.

A closer look at on-chain data reveals that stablecoin exchange inflows have reached an 18-month low, with a decline of 56% from the mid-2025 rally. This is evident in the significant drop in USDC and USDT supply since November 2025, which serves as a demand gauge.

Four separate on-chain lenses all point to the same conclusion: this is a liquidity drought, not a conviction collapse. The mean stablecoin inflows across all exchanges have dropped to 21,557, down from 100,000 to 280,000 during the mid-2025 rally.

According to CryptoQuant analyst Zakariya Sharif, a sustained recovery above 80,000-100,000 would be the first genuine sign of buyers returning. However, if inflows stay below 30,000 for two more weeks, it could lead to a retest of $58,000-$60,000.