The crypto market is buzzing with predictions that Bitcoin (BTC) could hit $100,000. But with the global M2 money supply set to expand in 2025, BTC might see even greater gains.
Global Liquidity Surge: Bitcoin's Catalyst?
Real Vision's chief crypto analyst, Jamie Coutts, has been tracking the impact of global M2 money supply on Bitcoin. Since Q4 2022, the worldwide M2 money supply has grown from $94 trillion to $105 trillion. During this period, Bitcoin's market valuation skyrocketed from $400 billion to around $2 trillion. Coutts notes that Bitcoin, like gold and stocks, has absorbed 10% of the new money supply from the fiat system. He poses an intriguing question: What happens if M2 grows by $30 trillion this cycle?
With global liquidity challenges, the M2 money supply is projected to reach $127 trillion by 2025, an 18% increase from $107 trillion. If Bitcoin captures 10% of this additional liquidity, its price could soar, potentially adding $2 trillion to its market cap.
Coutts supports his claim with a graphic comparing the Federal Reserve's balance sheet expansion, M2 money supply growth, real wage increases, and Bitcoin's price performance. BTC has outperformed other assets, especially as supply increases and the US dollar depreciates.
Market Outlook and Predictions
While increasing money supply could boost Bitcoin, experts are divided on the extent of this correlation. The global M2 money supply, which includes cash and short-term bank deposits, is expected to peak at $127 trillion in January 2026 before dropping to $118 trillion later that year. On this trajectory, Bitcoin could reach $150,000. However, crypto expert Joe Consorti warns that BTC's link to the global M2 money supply might cause a 20% to 25% drop, bringing it down to $70,000. Entrepreneur David Quintieri adds that BTC's volatility makes it difficult to track against any single metric.
With the approval of spot Bitcoin exchange-traded funds (ETFs) in the US, the upcoming Bitcoin Halving, increased institutional adoption, and the potential election of pro-crypto Donald Trump in November 2024, the leading cryptocurrency is poised for a pivotal year.
#XRPTrends #MarketInTheGreen #MarketBuyOrHold? #BTC #XRPTrends 🚀📈📊