Analyst Highlights Disconnect Between Bitcoin Price Peak and Global M2 Money Supply

A crypto analyst highlights a disconnect between Bitcoin’s price peak in November 2021 and the rising Global M2 money supply, indicating that Bitcoin doesn’t always react instantly to liquidity changes. This five-month lag could mean that Bitcoin may serve as a leading indicator of broader market shifts. Additionally, upcoming trends hint at potential upward movement for Bitcoin by September 2025, based on historic patterns with Global M2.

A notable crypto analyst has brought to light a significant disconnect between the peak price of Bitcoin and the ongoing growth of the Global M2 money supply. In his recent analysis, this raises quite the eyebrows—specifically about what really drives the crypto bull market and how the liquidity trends at play may influence price cycles.

Bitcoin’s price action ahead of the Global M2 seems a bit out of sync. According to Rekt Capital, a crypto expert voicing their thoughts on X (formerly known as Twitter), there’s this crucial delay between Bitcoin’s price movements and the state of global liquidity as measured by the Global M2 money supply. To put it plainly, Bitcoin hit an all-time high in November of 2021, which was clearly the peak of the preceding bull market. But interestingly, the Global M2 kept climbing for nearly five more months, peaking in April 2022.

This five-month discrepancy is quite telling and suggests that we might want to rethink how Bitcoin reacts to broader economic indicators. Rekt’s analysis implies that while Bitcoin is significantly influenced by liquidity conditions, it doesn’t respond immediately to these changes. Instead, Bitcoin might act as a kind of signal—hinting at shifts in both monetary policy and investor sentiment even before these shifts show up in traditional finance metrics like the money supply.

So while Bitcoin was already on its downturn post-November 2021, the global money supply was still growing, which shows that central banks and financial systems continued to operate with easy monetary conditions well into 2022. This analysis doesn’t claim a strict cause-and-effect link; rather, it shines a light on the distinct time lag between Bitcoin’s price movements and global liquidity trends. This places BTC in an intriguing spot within the financial ecosystem, acting both as an asset sensitive to liquidity and as a potential early warning signal for larger market changes.

Looking to September, there’s more conversation around Bitcoin and its potential surge. Another analyst known as Crypto Con has offered insights too, indicating a promising relationship between Bitcoin’s price movements and changes in Global M2. On June 25, he shared a compelling chart comparing Bitcoin’s historical performance with a 10-week shifted Global M2 metric.

This chart supports a pattern: when the Global M2 expands, Bitcoin tends to rally about ten weeks later. On the flip side, declines in M2 often lead Bitcoin’s price declines after a similar interval. This was notably the case during key moments in past market cycles. For instance, the significant M2 reduction in April 2023 predicted a downturn for Bitcoin, whereas a rebound in M2 that started in March 2024 coincided with a sustained increase in Bitcoin’s price. Similarly, the peak in M2 in December 2024 preceded a Bitcoin correction weeks later.

These observations lead to a pretty optimistic outlook; the current conditions remain quite favourable for Bitcoin. With the forward-shifted Global M2 showing an upward trend, it hints towards possibilities of further upside for Bitcoin as we approach early September 2025.

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