Stablecoin Holdings Decline from 50% to Approximately 43% Among Investors: Bybit Study
According to the Q2 Asset Allocation report from Bybit, stablecoin holdings have decreased among both institutional and retail investors from 50.2% in December to 42.8% in May. The overall percentage of stablecoin holdings among all users has seen a decline in the past month.
Bitcoin remains the dominant asset in investors’ portfolios, making up 26% of their total assets as of May 2024. When excluding stablecoins, Bitcoin and Ethereum together represent 61% of users’ crypto investments.
Retail traders have shown a preference for Bitcoin over Ethereum, similar to institutions, despite the growing optimism for ETH Spot ETFs. However, institutional positions in Bitcoin and Ethereum are more concentrated compared to those of retail traders, with holdings of 39.4% and 20.9% respectively as of May.
The report emphasizes the clear preference of institutional investors for Bitcoin, especially following the SEC’s approval of Bitcoin Spot ETFs in January 2024. Institutional Bitcoin holdings have been on the rise, while Ether positions have seen a surprising decrease. This could be due to concerns about Ether Spot ETFs not including staking rewards.
Retail traders have demonstrated their ability to time the market, reducing their Bitcoin positions in March and gradually adding them back in April and May to capitalize on the market’s rebound.
Institutions hold more concentrated positions in Bitcoin and Ether, while retail traders have more diversified portfolios but are showing a slight increase in concentration due to their preference for new altcoins.
The report also highlights fluctuations in users’ altcoin holdings, with altcoin holdings dropping from 25% in January 2024 to 20.9%, before rebounding to 22.5% in May 2024. New trading narratives, such as Bitcoin Layer 2 projects and meme tokens, have influenced these fluctuations.
Advocates of stablecoins praise their near-instant transactions and low costs, making them ideal for disrupting the payments sector. Companies like PayPal and Stripe are leveraging stablecoins for instant and cost-effective transfers within their payment infrastructure.
Overall, the report provides insights into the changing investment patterns of different user segments, highlighting the evolving preferences and strategies in the crypto market.
