The cryptocurrency market depends on the monetary supply of M2, suggests a Realvision analyst. In his opinion, printing dollars may push the price of bitcoin towards new records on the chart.
The cryptocurrency market is waiting for the printer to turn on. M2 supply will decide
The growing money supply in the United States may be the key to Bitcoin's chart growth. In other words, we are dependent on the Fed today. This is about the M2 money supply – cash and short-term bank deposits throughout the United States. Growth in this metric has historically been correlated with BTC growth.
The case was handled by Jamie Coutts, chief cryptocurrency analyst at Realvision. According to him, changes in the money supply are the most important factor that can drive growth.
The rate of change in the money supply is more important than the face value. The chart confirms what our MSI performance chart suggests: bitcoin tends to move with changes in M2 momentum
– wrote on X.
What do the raw numbers tell us? In early May, the M2 money supply turned positive year-on-year for the first time since November 2023. This means that investors' money has moved, it has been withdrawn from deposits and is starting to be invested.
This is interesting because theoretically it should only happen when the Fed starts cutting interest rates. As we know, this will happen only in the second half of the year. However, the market is already slowly starting to price in the future event. This is probably the reason for the jump in the price of gold and silver and the recent more cautious increases in BTC.
Bitcoin rate
According to popular cryptocurrency analyst Rekt Capital, BTC “broke its daily downtrend that started a month ago in mid-April.”
When downward trends are broken, upward trends emerge. Bitcoin has finally posted its first higher rally since the $56,000 low
– added.
Today, 1 BTC costs just over USD 66,000, which means a slight jump from yesterday. Over a 7-day period, an increase of over 4% was recorded. Ether is trading at $2,963, which signals a daily decline of 1.78%.
