
The crypto market is currently experiencing a lack of liquidity, accompanied by widespread disinterest and monotony, according to insights from Glassnode, an on-chain market intelligence firm. Both on-chain and off-chain volumes have reached historical lows, leading to a significant liquidity crunch. This situation closely resembles the pre-bull levels seen in 2020. Glassnode's report highlights a consistent decline in the supply of Bitcoin, Ether, and stablecoins since April 2022, partly due to the collapse of the Terra ecosystem, which was behind the algorithmic stablecoin TerraUSD. Another factor contributing to this decline is the failure to pass on higher interest rates to non-yielding stablecoins. Bitcoin and Ether initially witnessed a net inflow of capital at the start of 2023 but eventually reverted to neutral or negative inflow by late August, indicating uncertainty and stagnation. The report reveals that Bitcoin's total USD transaction volume has dropped to levels reminiscent of October 2020, and the daily trading volume of Bitcoin in off-chain derivatives hit a historical low of $12 billion. Matteo Greco, a Research Analyst at Fineqia International, concurs with this analysis, stating that liquidity in the market is currently at its lowest levels since the end of 2020 and the beginning of 2021. To address these challenges and boost liquidity, Lixin Liu, CEO of Account Labs, suggests that the crypto industry needs to move beyond the divide between hardcore HODLers and risk-averse individuals. Liu believes that real-world utility is the key to increasing usage and liquidity in the market.