Bitcoin News Today: Bitcoin Follows the Money as Global Liquidity Hits $112 Trillion

Global M2 money supply reached a record $112 trillion in 2025, driven by liquidity expansion across the U.S., China, and Europe, raising questions about its influence on Bitcoin’s price trajectory [1]. This global liquidity surge is often viewed as a leading indicator for Bitcoin, with historical data showing that Bitcoin tends to rally months before liquidity peaks reach their highest points. Analysts argue that Bitcoin’s price often reflects a forward-looking response to monetary expansion, rather than reacting in real time [1].

The U.S. M2 money supply, a key component of global liquidity, reached $22.13 trillion at the end of August 2025, up from $22.02 trillion in July [2]. This marks a steady expansion, having grown by $1 trillion in the past year alone. The U.S. metric is closely watched by investors and analysts, as it has historically preceded Bitcoin’s major price movements by a lag of approximately 60 to 90 days [2]. This pattern was observed during the 2021 crypto bull run, which coincided with a sharp increase in U.S. M2 money supply [1].

Bitcoin’s correlation with global liquidity is not limited to the U.S. In 2025, liquidity also surged in China and 19 other central banks, adding $7 trillion to the global M2 supply since January [2]. This expansion has been mirrored in Bitcoin’s performance, with the cryptocurrency often tracking global liquidity trends before experiencing sharp corrections or rebounds. For example, Bitcoin’s price dropped from over $100,000 in January 2025 to below $80,000 by April 2025, but began a recovery phase as global liquidity continued to rise [1].

Analysts suggest that Bitcoin may follow a similar pattern in the coming months, potentially extending into 2025 if liquidity growth continues. Historical trends show that Bitcoin tends to catch up with the broader liquidity trend after a period of correction [2]. The cryptocurrency is currently valued at $109,175, which is close to its all-time high, but lags slightly behind the most recent additions to both global and U.S. M2 money supply [2]. This gap could signal a potential new rally, especially as global liquidity remains a strong tailwind for risk assets.

Bitcoin’s behavior also mirrors broader asset classes such as the S&P 500 index and gold, which have historically moved in tandem with rising liquidity and low-interest rate environments [2]. While Bitcoin does not currently outperform these asset classes, it has shown a consistent correlation with their movements. This suggests that Bitcoin is not an isolated asset, but one that is deeply embedded in the global financial system. As central banks continue to expand liquidity, the interplay between global M2 and Bitcoin is likely to remain a critical factor in shaping the cryptocurrency’s price direction.

Source:

[1] Bitcoin vs Global M2 Growth Chart (https://newhedge.io/bitcoin/bitcoin-vs-global-m2-growth)

[2] The USA M2 Money Supply Surges to New All-Time Peak (https://www.cryptopolitan.com/the-usa-m2-money-supply-surges-to-new-all-time-peak-btc-historically-follows/)