Bitcoin braces for $70,000 test as stablecoin supply shrinks $14.2B

Stablecoin supply shrank by $14.2 billion over the past 30 days, the sharpest contraction since June 2022, according to Glassnode's Nov. 11 report. The retreat is draining the dollar liquidity that powered Bitcoin's last rally and leaves the top crypto exposed to a slide toward $70,000. Bitcoin traded around $74,029, down 8.37% on the week and 10.19% on the month.

Tether's USDT is the biggest casualty. CryptoQuant data shows it lost $6.6 billion in market capitalization over 60 days — more than double the $3.2 billion decline recorded after FTX's collapse in December 2022. It's a hard flip from the boom times, when USDT's 60-day supply growth peaked at $20.6 billion in December 2024 and generally ran between $10 billion and $16 billion through much of 2025.

Demand is bleeding too. CryptoQuant's apparent demand indicator dropped to negative 284,000 BTC over 30 days, its weakest reading since March 28, 2025, though similar readings of negative 309,000 BTC in March 2025 and negative 273,000 BTC in June 2026 preceded recoveries. Institutions aren't helping this time: the Coinbase Premium Index has stayed negative for 30 consecutive days at an average of roughly minus 0.14%, and US spot Bitcoin ETFs posted $1.6 billion in net outflows across 20 trading sessions.

The buyers who piled in during the August and September rally are now sitting on losses. CryptoQuant puts the unrealized profit margin on coins held one to three months at negative 6%, down from 33% on Sept. 22 — a 39% reversal — with an average acquisition price near $79,500 against a market price of about $74,600.

Earlier corrections in this cycle have often dragged that margin to negative 12% before stabilizing. Deeper slumps hit negative 18% from July to September 2024, negative 19% in April 2025 and negative 23% in July 2026. At the $79,500 cost basis, a negative 12% margin would put Bitcoin near $70,000, roughly 6% below CryptoQuant's reference price.

Glassnode's short-term holder data sharpens the picture: only 35% of Bitcoin bought within the past 155 days is still profitable, versus nearly all of that supply at September's high. Those holders' aggregate cost basis sits near $75,600, with large blocks bought between August and October priced as high as $83,600 — levels that could trigger breakeven exits if a recovery takes hold.