Bitcoin crossed the $100,000 mark this week, climbing to a peak of $104,000 on May 8, as a chart tracking the global M2 money supply, lagged by 90 days, resurfaced on social media.
The correlation between Bitcoin’s breakout and a revived upswing in the M2 liquidity curve gained renewed traction across trading forums and analyst desks, prompting a closer look at the mechanics of this market alignment.
When adjusted for a 90-day lag, global M2 has sometimes foreshadowed turning points in Bitcoin’s price over multi-month windows. The idea gained prominence during the 2021 bull cycle and has since re-emerged as an interpretive lens, especially as BTC decouples from tech equities.
Julien Bittel, Head of Macro Research at Global Macro Investor, commented that the M2 vs Bitcoin chart “still tells the same story: We’re going higher.”
CryptoSlate analysis highlighted that while real in some aspects, the correlation is elastic, aligning more with global liquidity cycles than anything else.
The chart in question, circulated widely since April, overlays the price of Bitcoin with the Global M2 Liquidity Index, which has shifted by three months.
M2, a measure of global money supply growth, began a fresh ascent in February. That rise is now materializing in markets, with Bitcoin’s price trajectory tracking the lagged M2 curve almost to the day.
CryptoSlate’s chart tracking 90-day lagged global M2 with Bitcoin and its correlation confirms the inference.
While traders continue to debate the predictive power of liquidity metrics, the breakout timing is difficult to ignore.
Bitcoin price factors outside M2
Over the past 10 weeks, Bitcoin has recovered from a sub-$80,000 consolidation phase to reclaim six figures, driven partly by consistent inflows into digital asset funds.
In the past three weeks, billions have flowed into crypto investment products, with $1.8 billion directed to Bitcoin ETFs. On May 7, a single-day net inflow of $422 million was led by BlackRock’s IBIT, the largest spot Bitcoin ETF with approximately $58 billion in assets under management.
The rolling correlation between Bitcoin and lagged M2 measures offers a more complex picture. The 180-day Pearson correlation between the two has averaged 0.65 since early 2024, though 30-day readings show volatility, oscillating between -0.9 and +0.95. This variability cautions against reading too deeply into short-term overlaps.
Beyond ETF flows and liquidity overlays, the broader macro environment adds weight to the thesis. The U.S. dollar index has slipped nearly 4% since late February, and trade-driven capital rotation has contributed to demand for decentralized alternatives. Though M2 metrics do not account for stablecoin issuance or off-balance-sheet credit, they remain a reference point for modeling system-wide liquidity pressures.
Bitcoin’s current position near $103,000 coincides with a broader wave of risk-on positioning across digital assets, but whether the M2 model retains influence over forward price discovery depends on liquidity persistence. Should central bank data continue to reflect a climbing M2 curve, attention may shift to how much of that liquidity finds its way into crypto via institutional channels.
Where Bitcoin correlation with M2 supply fails
While the 90-day lag chart remains a visually compelling narrative tool, its utility as a trading signal is bounded by noise and external catalysts. As the price climbs, the model may serve more as a sentiment anchor than a deterministic forecast.
For now, Bitcoin sits above $100,000 for the second time in 2025, reasserting its capacity to track and reflect global liquidity cycles, even as the mechanisms behind that correlation remain fluid.
Interestingly, since the start of 2025, the global M2 money supply has increased by 3.25%. However, the 90-day lagged chart has actually decreased by 0.16% over the same period, and Bitcoin is up around 8%. Thus, were Bitcoin to be following global lagged M2 precisely, it would be down on the year.
If you alter the analysis window to the last 12 months, Bitcoin is up 75%, global M2 is up 3.8%, and lagged M2 is up 7.37%, meaning that over this period, Bitcoin has massively outperformed M2.
Therefore, as stated in the previous analysis, Bitcoin’s correlation with the lagged global M2 money supply is an extremely powerful metric, except when it’s not.
It is undoubtedly fun to watch, though.
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