NEWSLETTER
bitcoin price fluctuations are frequently evaluated using chain metrics, technical indicators and macroeconomic trends. However, one of the most underestimated but significant factors in bitcoin's price action is global liquidity. Many investors may be underutilizing this metric or even misunderstanding how btc cyclic trends affects.
<h2 class="wp-block-heading" id="impact-on-bitcoin“>Impact on bitcoin
With increasing discussions on platforms such as twitter (x) and analysts who dissect liquidity graphics, understanding the <a target="_blank" href="https://www.bitcoinmagazinepro.com/bitcoin-macro/m2-global-vs-btc/” target=”_blank” rel=”noopener”>relationship between global liquidity and bitcoins It has become crucial for long -term merchants and investors equally. However, recent divergences suggest that traditional interpretations may require a more nuanced approach.
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Global M2 Money Supply refers to the total supply of liquid money, which includes cash, verification of almost convertible deposits and money. Traditionally, when Global M2 expands, capital seeks higher performance assets, including bitcoin, basic actions and products. On the contrary, when M2 hires, risk assets often decrease in value due to more strict liquidity conditions.
<a target="_blank" href="https://www.bitcoinmagazinepro.com/bitcoin-macro/m2-global-vs-btc/” target=”_blank” rel=”noopener”>See live graphic
Historically, we have seen that the price of bitcoin follows the global expansion of M2, increasing when liquidity increases and suffering during contractions. However, in this cycle, we have seen a deviation: despite a constant increase in the Global M2, bitcoin's price action has shown inconsistencies.
Year -on -year change
Instead of simply tracking the absolute value of Global M2, a more insightful approach is to analyze its interannual exchange rate. This method represents the speed of expansion or liquidity contraction, revealing a clearer correlation with the performance of bitcoin.
When we compare the <a target="_blank" href="https://www.bitcoinmagazinepro.com/bitcoin-macro/global-m2-vs-btc-yoy/” target=”_blank” rel=”noopener”>bitcoin Annual return (interannual) with the global change of m2 m2 yoyA much stronger relationship arises. bitcoin's strongest bull is aligned with periods of rapid liquidity expansion, while the contractions precede price decreases or prolonged consolidation phases.
<a target="_blank" href="https://www.bitcoinmagazinepro.com/bitcoin-macro/global-m2-vs-btc-yoy/” target=”_blank” rel=”noopener”>See live graphic
For example, during the bitcoin consolidation phase in early 2025, Global M2 constantly increased, but its exchange rate was flat. Only when the expansion of m2 accelerates significantly can bitcoin towards the new maximums.
Liquidity delay
Another key observation is that global liquidity does not affect bitcoin instantly. The investigation suggests that bitcoin is left behind the changes in global liquidity in approximately 10 weeks. By changing the global liquidity indicator forward in 10 weeks, bitcoin correlation is significantly strengthened. However, greater optimization suggests that the most accurate delay is around 56 to 60 days, or approximately two months.
<h2 class="wp-block-heading" id="bitcoin-outlook”>bitcoin perspective
During the most part of 2025, global liquidity has been in a flatness phase after significant expansion at the end of 2024 that bitcoin promoted new maximums. This flattening coincided with the consolidation and decline of bitcoin to around $ 80,000. However, if historical trends are maintained, a recent resurgence in the growth of liquidity should translate into another advantage for btc at the end of March.
Conclusion
Monitoring global liquidity is an essential macro indicator to anticipate bitcoin's trajectory. However, instead of trusting M2's static data, focusing on its exchange rate and understanding the two -month delay effect offers a much more precise predictive framework.
As global economic conditions evolve and central banks adjust their monetary policies, bitcoin's price action will continue to be influenced by liquidity trends. The next weeks will be fundamental; bitcoin could be ready for an important movement if global liquidity continues its renewed acceleration.
Did I enjoy this? Explore more about bitcoin's price changes and market cycles in our recent guide to dominate bitcoin data in the chain.
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Discharge of responsibility: This article is only for informative purposes and financial advice should not be considered. Always do your own research before making investment decisions.
