Bitcoin Tumbles—Analysts Finger M2 Money Supply as the Smoking Gun
Bitcoin’s latest pullback isn’t just another crypto tantrum—traders are digging into its eerie dance with global money supply metrics. Could this be the Fed’s fault? (Spoiler: Wall Street will still blame ’retail investors.’)
When BTC stumbles, the usual suspects get rounded up: leverage liquidations, whale sell-offs, or Elon’s latest tweet. But this time, charts are flashing a tighter correlation with M2 money supply shifts than a DeFi protocol mimics traditional finance’s worst habits.
Here’s the kicker: every time central banks hit ’print,’ crypto gets a sugar rush—until the crash. Now? The hangover’s here, and the charts don’t lie. Just don’t expect your broker to admit their fiat system’s the problem.
- Bitcoin corrected around 0.8%, dipping near $104,000, but May’s average 19% growth supports bullish cycles linked to money supply.
- Analysts forecast a short-term drop to $95,000, then a surge toward $130,000 by late summer amid rising global M2 liquidity.
- Price targets vary widely: $130K-$150K by year-end, $250K from BitMEX, and $1.5M predicted by Ark Invest for 2030.
Bitcoin (BTC) experienced a notable correction over the past 24 hours reaching $104,000, prompting renewed discussions about its relationship with the M2 money supply. Analysts like Raoul Pal and Abra CEO Bill Barhydt are using this correlation to forecast Bitcoin’s price trajectory in the coming months.
Bill Barhydt, CEO of Abra Global, shared insights on X, highlighting the increasing trend between BTC and global M2 liquidity. Barhydt emphasized data from macro analysts such as Raoul Pal and Julien Bittel, pointing to multiple charts that predict a near-term dip to about $95,000. However, this is expected to be followed by a surge reaching a new all-time high NEAR $130,000 around August or September.
Institutional Demand and Future Market Impact
Should the liquidity-driven rally unfold as expected, Bitcoin’s gains might spill over into layer-1 blockchain platforms and speculative altcoins, potentially triggering the much-anticipated next “alt season.” Institutional adoption is playing a crucial role, with recent large purchases like the Strategy fund’s acquisition of 4,020 BTC boosting scarcity and market confidence.
Barhydt stressed that Bitcoin’s status as the primary beneficiary of increasing liquidity remains intact. However, the correlation between M2 money supply and BTC price is still debated, some critics argue that M2 does not always dictate BTC’s price direction, while supporters maintain that long-term patterns have historically held.
Despite the recent 8% correction, BTC continues to align with its historical bullish cycles linked to money supply growth. May traditionally favors Bitcoin, often producing an average 19% growth rate. So far this month, Bitcoin has posted a 10% gain, with the latest price dip having minimal impact on long-term holders.
Analysts Predict Bitcoin $130K-$150K
Currently, bitcoin is trading about $104,400 revealing a slight increase of 0.83% for the past 24 hours. Analysts and investors believe that the market will keep going up throughout the season and the local economy, thus the rally is not a surprise over the next several weeks.
Galaxy Digital founder Mike Novogratz adopts a more cautious outlook but still anticipates BTC reaching between $130,000 and $150,000 by year-end. On the other hand, BitMEX’s Arthur Hayes brought forward a much more aggressive goal of $250,000, projecting the price to be doubled, and thus offering investors substantial profits.
The leader of Ark Invest, Cathie Wood has made the most challenging prediction that the price of Bitcoin may go up to as much as $1.5 million by 2030. Although this target is long-term, it underscores the broad range of expectations within the crypto community about Bitcoin’s future value.
Read More: Urgent Bitcoin Alert: Sharpe Ratio Predicts Surge, But Altseason Is Missing
