The growing M2 global money supply could trigger a major Bitcoin rally, but an analyst cautions against betting everything on the emerging signal.
“This isn’t a market to bet your whole stash on a quick correction, but our central scenario is still for a strong March and beyond,” Pav Hundal, the lead analyst at Australian crypto exchange Swyftx, told Cointelegraph.
“It’s not all doom and gloom”
“In normal times, global loosening measures are a pretty reliable lead indicator for crypto,” Hundal said. “The data we have suggests that spot buyers are active right now, and the US has raised its debt ceiling by $4 trillion dollars.”
“It’s not all doom and gloom,” he added. The year-on-year fixed exchange rate for the M2 money supply of the four major central banks reached 3.65% in January, according to MacroMicro data.
Many crypto analysts point to historical trends where a global M2 money supply rise has led to higher Bitcoin (BTC) prices, driven by increased liquidity and lower interest rates.
Economist Lyn Alden wrote in a September research report that Bitcoin moves in the direction of global M2 83% of the time.
US money supply surge may “fuel Bitcoin’s parabolic run-up”
Crypto analyst bitcoindata21 said in a Feb. 25 X post, “With weakness in the dollar causing a net positive effect on Global M2, just a matter of time hopefully before Bitcoin realizes.”
Echoing a similar sentiment, crypto analyst Colin Talks Crypto said in an X post that “the Global M2 Money Supply predicts a BIG MOVE is coming for Bitcoin.”
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Investment research account Bravo Research said in a Feb. 25 X post that the US money supply had doubled in just 10 years, and “this liquidity surge could fuel Bitcoin’s parabolic run-up.”
It comes as Bitcoin dropped below $90,000 on Feb. 25 for the first time since November after Trump said a day earlier that his planned 25% tariffs on Canada and Mexico “are going forward on time, on schedule.” He had agreed to pause them for 30 days earlier this month.
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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
