Bitcoin continues to face volatility in the markets. Key factors affecting its price remain the global money supply and potential state involvement.
Global M2 Influence on Bitcoin
One significant factor influencing Bitcoin's price rise is the global M2 money supply — the total amount of money in circulation, including cash, checking deposits, and easily convertible near money. Historically, when M2 has increased, Bitcoin has responded with strong bullish movements. During the last major M2 surge, Bitcoin rose by 60%. If a similar trend holds, Bitcoin could see a rise to $115,000, assuming just 0.5% of new M2 assets flow into Bitcoin.
Nation-State Strategy and Its Impact
Another factor that could influence Bitcoin's price is the potential involvement of nation-states. If a government begins printing fiat currency to buy Bitcoin, it could create immense upward pressure on the market. This strategy, referred to as the nation-state game theory, suggests that the first country to adopt such an approach could dominate the crypto space.
Growth Potential and Risks for Bitcoin
Considering all factors, the most likely scenario for Bitcoin in the next three months is a price range between $99,000 and $115,000, with potential for even higher gains if market conditions shift favorably. There is, however, an 80% chance of maintaining the current bullish trend and a 20% chance of facing setbacks.
Bitcoin's future remains uncertain, but factors such as global M2 and potential state involvement could significantly impact its price.
