Bitcoin continues to show remarkable stability between $108,000 and $110,000, maintaining this range despite recent market volatility. As technical indicators signal a potential major move at the $108K level, a compelling correlation with global money supply data suggests an ambitious price target ahead.
The M2 Money Supply Connection
Cryptocurrency analyst Kyle Chassé has identified a fascinating pattern: Bitcoin price movements tend to follow global M2 money supply trends with a 90-day lag. By analyzing Bitstamp exchange data against shifted M2 figures, a clear correlation emerges – when global liquidity expands, Bitcoin typically sees significant appreciation approximately three months later.
Recent Price Action and M2 Growth
The correlation becomes evident when examining recent market activity. Bitcoin’s surge above $109,000 in January 2025, subsequent drop below $75,000 in April, and current recovery align with previous M2 supply movements. Despite reaching new all-time highs with relatively low retail interest, the pattern suggests this may be just the beginning.
SPONSORED
Trade Bitcoin with up to 100x leverage and maximize your potential returns
The Path to $400,000
Global M2 has grown from $98 trillion in early 2023 to over $111 trillion currently. Based on this trajectory and the established correlation, Chassé projects a potential Bitcoin price of $400,000 – representing a 270% increase from current levels.
Additional Market Factors
While the M2 correlation is compelling, other factors could influence Bitcoin’s trajectory:
- Central bank policies and interest rates
- On-chain metrics and network activity
- Institutional adoption rates
- Regulatory developments
FAQ Section
What is M2 money supply?
M2 is a measure of the money supply that includes cash, checking deposits, and easily convertible near money.
Why does Bitcoin lag behind M2 by 90 days?
The lag represents the time it takes for increased liquidity to flow through the financial system and eventually reach cryptocurrency markets.
Is $400,000 Bitcoin realistic?
While ambitious, the target is based on historical correlations with M2 supply growth. However, multiple factors could impact this projection.
Featured image from Unsplash, chart from TradingView
