The Stablecoins Market Cap Risk indicator serves as a valuable risk oscillator for Bitcoin on a macro scale. This metric is derived by aggregating the market capitalization of USDT (Tether) and USDC (USD Coin), subsequently dividing this combined value by TOTAL (total market capitalization). The resulting figure is further normalized through linear regression.
However, it is essential to acknowledge that this model's reliability may diminish over time, as it is based solely on data from the most recent 4.5 years of cryptocurrency market trends. Consequently, adaptations and enhancements to the model are anticipated in the future to ensure its continued relevance and accuracy.