Experts indicate that the increase in M2 money supply impacts Bitcoin's price. This article examines the key findings of analysts regarding how the correlation between M2 and Bitcoin might affect the market in 2025.
Impact of M2 Money Supply on Bitcoin
Key analysts like Michaël van de Poppe emphasize Bitcoin's 12-week lag correlation with M2 expansions, shaping trading strategies in 2025. This pattern highlights Bitcoin’s responsiveness to monetary supply changes.
> 'Bitcoin’s 12-week lag correlation with M2 underscores the cryptocurrency’s responsiveness to monetary expansion.' CITE_W_A
Bitcoin vs. Altcoins in the M2 Landscape
Bitcoin’s market cap expansion exhibits notable growth, reclaiming $108,000 and a 15.53% year-to-date gain. However, altcoins struggle to match this despite increased liquidity, affecting their overall performance. Higher M2 levels create improved trading conditions, shifting capital into Bitcoin as a hedge against inflation. Altcoins such as ETH are impacted but lag behind Bitcoin’s performance.
Future Outlook: Bitcoin’s Potential Growth
Analysis suggests maintaining M2’s historic correlation with Bitcoin may propel the latter toward $250,000 by year’s end. This scenario depends on sustained liquidity and market confidence. Experts foresee potential regulatory tweaks and technological adaptations as central banks observe crypto markets under increasing liquidity. Historical M2 surges have driven past Bitcoin rallies, indicating potential future trends.
The influence of M2 money supply on Bitcoin highlights the significance of monitoring monetary policy for the informed investor. Sustained liquidity may unlock new horizons for the cryptocurrency market.
