Gold and Bitcoin Now Worth 133% of US Money Supply: Is the Cycle Nearing Its End in 2025?

What Does It Mean for Gold and Bitcoin to Outpace the US Money Supply?

The US money supply, often referred to as M2, includes cash, checking deposits, and easily convertible near-money. When gold and bitcoin collectively exceed this figure by 33%, it signals a seismic shift in asset valuation. Historically, such divergences have preceded major economic recalibrations—think the 2008 financial crisis or the 1970s stagflation. But this time, it’s different. Bitcoin, the digital gold, is playing a starring role alongside its physical counterpart.

How Did We Get Here?

Let’s rewind. Gold has been the go-to store of value for millennia, but Bitcoin? It’s barely 16 years old. Yet, in 2025, the two have formed an unlikely alliance, dwarfing the US money supply. The Federal Reserve’s aggressive monetary policies post-2020—quantitative easing, near-zero interest rates—flooded the system with liquidity. Investors, wary of inflation, flocked to hard assets. Gold hit record highs, and Bitcoin, well, it did what Bitcoin does: defied expectations.

Is This Sustainable?

Here’s where things get spicy. Analysts at BTCC (yes, the crypto exchange) argue that while gold’s trajectory is relatively predictable, Bitcoin’s volatility adds a wildcard. “We’re in uncharted territory,” one analyst noted. “A 133% overshoot isn’t just a blip—it’s a statement.” But skeptics counter that all cycles end, often painfully. Remember 2022? Yeah, neither do we fondly.

What’s Driving the Demand?

Three words: fear, greed, and FOMO. Institutional investors are piling into Bitcoin ETFs, while central banks (yes, even the ECB) are stockpiling gold. Retail traders? They’re caught in the middle, oscillating between euphoria and dread. Data from CoinMarketCap shows Bitcoin’s market cap now rivals some of the world’s largest corporations, while TradingView charts reveal gold’s relentless uptrend.

Could This Be the Peak?

Maybe. Or maybe not. History suggests that when an asset class surpasses the money supply, corrections follow. But Bitcoin laughs in the face of history. Its 2024 halving slashed supply, and with spot ETFs gobbling up coins faster than they’re mined, demand is insatiable. Gold, meanwhile, benefits from geopolitical chaos—pick your crisis: Taiwan tensions, European energy shortages, or the ever-present specter of inflation.

What Should Investors Do?

First, breathe. Then, diversify. The BTCC team recommends a balanced portfolio: “Don’t bet the farm on either asset,” they caution. Gold offers stability; Bitcoin offers rocket fuel. Mix them wisely. And remember, this article does not constitute investment advice. (But if it did, we’d say keep an eye on Fed policy meetings—they’re the real market movers.)

The Bottom Line

Gold and Bitcoin at 133% of the US money supply is a headline grabber, but it’s also a warning. Markets MOVE in cycles, and this one feels long in the tooth. Whether it ends with a bang or a whimper depends on factors no one can predict—least of all this writer. Stay nimble, stay informed, and maybe keep some cash under the mattress. Just in case.

FAQs

How often does the combined value of gold and Bitcoin exceed the US money supply?

This is the first recorded instance where the combined value surpasses 133% of M2, making it a historic anomaly.

Why include Bitcoin alongside gold in this analysis?

Bitcoin is increasingly viewed as “digital gold” due to its scarcity (capped at 21 million coins) and store-of-value properties.

Does this signal an impending market crash?

Not necessarily, but extreme valuations often precede volatility. Consult a financial advisor for personalized guidance.