Morgan Stanley Analyst Says Crypto Economy’s Liquidity Has Improved, But There’s “No Huge Demand for Re-Leverage” – Reuters


An analyst at New York-based currency firms and funding administration firm Morgan Stanley detailed on Monday that crypto liquidity appears to be recovering. Morgan Stanley’s Sheena Shah pointed out in a word to buyers that the stablecoin market cap is seeing fewer redemptions for the first time since April.

Opinion From Morgan Stanley Buyers Says Crypto Winter May Be Unfreezing, But Demand For Re-Leverage Is Still Nonexistent

The crypto winter could also start to heat up as institutional buyers halted redemptions of the crypto financial system’s two major stablecoins, according to a current assessment authored by Morgan Stanley’s cryptocurrency analysis. lead Sheena Shah. The mainly UK-based analyst also said demand has also fallen among buyers looking for leverage. There has been a significant shortfall in decentralized finance (defi) loans Shah detailed.

“There doesn’t seem to be a huge demand for re-mining the crypto world right now,” Shah noticed in the Buyers’ Word printed Monday. “It will likely be difficult for this crypto cycle to reverse without increasing fiat leverage or increasing crypto leverage,” the senior cryptocurrency analyst at Morgan Stanley added.

Morgan Stanley Analyst Says Crypto Economy's Liquidity Has Improved, But There's 'No Huge Demand to Remine'
BTC/USDT hourly chart on August 22, 2022 at 12:35 PM (EST) on Monday afternoon.

Morgan Stanley’s Sha last week set the general stablecoin market valuation, which is currently valued at $153.26 billion, did not fall in value for the first time since April 2022. The Morgan Stanley analyst said “excessive institutional deleveraging” has taken a short break in the meantime. Current market information reveals that over the past 30 days, the market capitalization of tether (USDT) has increased by 2.6%, while the usd coin (USDC) has fallen by 4.6%.

The Morgan Stanley crypto researcher observed the decline in USDC market valuation, and also noted that it began in the first week of July. “USDC’s market capitalization fall began before the regulatory change and resembles the decline seen earlier in the 12 months between March and May,” Shah’s word to buyers explains.

September is historically a bitter month for crypto, but some imagine the merger could change the 4-year development

The crypto eThe economy suffered losses over the weekend as the value fell from $1.18 trillion to $1.06 trillion on Monday afternoon (EST). People expect the crypto financial system to falter or even decline in September as the month is historically an unpleasant month due to the history of the crypto market. On August 21, the Twitter account known as bleeding crypto mentioned how bitter September has been for crypto for the past 4 years in a row.

“Every year we see how bad September is for crypto, but you have to think ‘this time it’s completely different’ – you can choose to stick your head in the sand, I’ll choose to listen to the market “, Bleeding Crypto tweeted. Regardless of the drop in crypto values, market contributors consider this September to be possibly a completely different month.

Morgan Stanley Analyst Says Crypto Economy's Liquidity Has Improved, But There's 'No Huge Demand to Remine'
September bitcoin charts shared by the Bleeding Crypto Twitter account on August 21, 2022.

This is because the merger is expected to take place on September 15, and it has been speculated that the value of Ethereum (ETH) could skyrocket with the rest of the crypto financial system as a byproduct. Nevertheless, it is quite potential for The Merge to be already priced while ETH noticed significant positives last month that strengthened the crypto financial system at the same time.

Tags on this story

Bleeding Crypto, crypto financial system, crypto liquidity, crypto stocks, Ethereum, Ethereum (ETH), excessive institutional deleveraging, institutional buyers, leverage, morgan stanley, Morgan Stanley analyst, re-leverage, September, September Crypto, September Markets, Stablecoins, Tether, The Merge, usd coin, USDC, USDC market valuation, USDT

What do you consider the Morgan Stanley analyst’s word on crypto liquidity and redemptions of less stable coins? Let us know what you think about this topic in the comments section below.


Jamie Redman

Jamie Redman is the Chief Information Officer at Information and a money-tech journalist residing in Florida. Redman has been an energetic member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized functions. Since September 2015, Redman has written over 5,700 articles for News regarding disruptive protocols that are on the rise as we speak.

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