Bitcoin’s rise past $100k continues to correlate with the global M2 money supply growth from three months ago.

This week, Bitcoin achieved a significant milestone, reaching an all-time high of $104,000 on May 8, as a chart reflecting the global M2 money supply with a 90-day delay gained attention on social media.

The renewed relationship between Bitcoin’s surge and a resurgence in the M2 liquidity curve became a hot topic on trading platforms and among analysts, leading to an examination of how these market dynamics align.

When considering a 90-day delay, shifts in global M2 have previously indicated price changes in Bitcoin over several months. This concept gained traction during the 2021 bull market and has resurfaced as a valuable analytical tool, especially as Bitcoin begins to diverge from technology stocks.

Julien Bittel, who heads Macro Research at Global Macro Investor, remarked that the relationship between the M2 liquidity chart and Bitcoin “continues to suggest: We’re moving upwards.”

Recent analysis has pointed out that while the correlation holds some validity, it is more flexible, aligning closely with global liquidity trends rather than a strict correlation.

The chart that has been widely distributed since April overlays Bitcoin’s price with the Global M2 Liquidity Index, adjusted to factor in a three-month delay.

Since February, M2, which tracks global money supply growth, has entered a new upward trend. This increase is now evident in the market, with Bitcoin’s price following the lagged M2 curve closely.

The chart depicting the lagged global M2 alongside Bitcoin reinforces this interpretation.

While discussions around the forecasting ability of liquidity indicators continue, the timing of Bitcoin’s breakout is noteworthy.

Factors Driving Bitcoin’s Price Beyond M2

In the past ten weeks, Bitcoin has rebounded from a consolidation period below $80,000 to surpass the six-figure threshold, largely fueled by steady investments in digital asset vehicles.

In just the last three weeks, cryptocurrency investment products have seen billions in inflows, with $1.8 billion specifically allocated to Bitcoin ETFs. Notably, on May 7, a daily net inflow of $422 million was recorded, primarily from BlackRock’s IBIT, which is the largest spot Bitcoin ETF managing around $58 billion in assets.

The dynamic between Bitcoin and the lagged M2 showcases a more intricate narrative. The 180-day Pearson correlation has averaged 0.65 since early 2024, while 30-day readings have fluctuated between -0.9 and +0.95. This variability suggests caution in interpreting short-term relationships.

In addition to ETF contributions and liquidity considerations, the broader economic environment reinforces the argument. The U.S. dollar index has declined nearly 4% since late February, and capital rotation driven by trade has increased preference for decentralized alternatives. Although M2 figures do not consider stablecoin creation or off-balance-sheet credit, they serve as a benchmark for assessing liquidity conditions across the system.

Bitcoin’s recent valuation around $103,000 aligns with a general trend of risk-taking in digital assets, yet the extent to which the M2 model influences future price movements will depend on the durability of liquidity. If central bank data continues to show an upward M2 trajectory, the focus may shift toward how much of that liquidity transitions into cryptocurrency through institutional investments.

Limitations of Bitcoin’s M2 Correlation

While the 90-day lag chart presents an engaging narrative, its effectiveness as a trading signal is limited by external variables and market noise. As prices rise, the model may function more as a gauge of sentiment than as a definitive predictor.

Presently, Bitcoin stands above $100,000 for the second time in 2025, reaffirming its ability to mirror and respond to global liquidity cycles, even as the underlying mechanisms of this correlation remain uncertain.

Interestingly, since the onset of 2025, the global M2 money supply has risen by 3.25%. However, during the same time frame, the 90-day lagged chart has seen a slight decrease of 0.16%, while Bitcoin has appreciated around 8%. Thus, if Bitcoin had been following the global lagged M2 strictly, it would show a decline this year.

Examining the last year, Bitcoin has increased by 75%, global M2 has risen by 3.8%, and the 90-day lagged M2 shows an increase of 7.37%, indicating that Bitcoin has greatly outperformed M2 during this timeframe.

Consequently, as noted earlier, Bitcoin’s relationship with the lagged global M2 money supply is a compelling metric, though it has its exceptions.

Watching the interplay remains engaging.