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Not Money Supply: The Real Liquidity Metric That Drives Bitcoin

Institutional Crypto Research Written by Experts

Author

Markus Thielen
April 17, 2025

We now include a conclusion at the end of each report to help readers quickly grasp the key takeaways and core message.

Topics: Money Supply, Liquidity

👇1-14) As anticipated, Fed Chair Powell confirmed that the Federal Reserve will likely remain on hold for an extended period. The introduction of larger-than-expected tariffs will push inflation higher while slowing growth. Powell emphasized the need for more data before considering any changes to interest rates.

👇2-14) He also dismissed the marginal impact that DOGE-related savings might have on discretionary spending, instead shifting focus toward addressing government debt and deficits. These remarks suggest that monetary policy will remain restrictive and offer limited support for Bitcoin until inflation declines meaningfully, which is unlikely before the summer.

👇3-14) Overlaying Bitcoin with the Global Money Supply (M2 from 28 central banks), shifted forward by 13 weeks, has provided a remarkably accurate projection of Bitcoin’s price movements over the past 18 months. While the chart is visually compelling, we believe Bitcoin is more likely to respond to a different, more relevant liquidity metric.

Bitcoin (LHS) vs. Global Money Supply (RHS, 13 weeks ahead)

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