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coinpedia 2024-11-29 07:33:49

Why Bitcoin Is Struggling to Cross $100K: Insights on Money Supply Trends

The post Why Bitcoin Is Struggling to Cross $100K: Insights on Money Supply Trends appeared first on Coinpedia Fintech News Over the past decade, the global money supply has surged by at least $50 trillion. The crypto market, especially Bitcoin, has benefited immensely from this rise, as BTC is generally considered as a hedge against inflation. Recently, the global money supply has seen a sharp drop. Meanwhile, Bitcoin is struggling to achieve the milestone of $100K. The pressing question that bothers Bitcoin enthusiasts right now is: ‘Is BTC’s weakening momentum linked to declining global money supply?’ Time to dive in for an in depth analysis. Ready? Recent Trends in Global Money Supply and Bitcoin At the start of this moment, Bitcoin stood at around $69,542.78. Between November 5 and 22, the Bitcoin market climbed by over 45.82%, touching a new all-time high of $98,884.91. However, soon after, the pace of the momentum slowed down. Between November 24 and 26, the market experienced the first major correction since November 5, when the price slipped sharply by over 7.06%. The market has not yet completely recovered from the impact of this correction. Yesterday, BTC saw another drop of 0.23%. At the beginning of the year, the M2 Growth YoY index was at 3.19%. In mid-Fed, it dropped to -0.18%. However, in early-March, it sharply climbed to 2.72%. In mid-April, it again fell to -0.34%. Between August 5 and September 30, it sharply rose from 4.17% to 7.09%. Later, it plummeted sharply. Now, it stands at 1.83%. Correlation Between Bitcoin and M2 Global Money Supply Historically, Bitcoin bull markets have coincided with periods of rising M2 growth. Between February 12 and March 4, the M2 Growth YoY index rose from -0.18% to 2.72%. In mid-March, the BTC price achieved an all-time high of $73,000+. A drop in the index could signal limited upside potential in the short term. Lower liquidity can also lead to higher volatility in the Bitcoin market. As of writing, the M2 Global Supply stands at $105,087,858,680,803 – approximately 2.24% lower than the Sep 30 supply of $108,024,482,423,918. In conclusion, as global money supply trends evolve, Bitcoin’s correction with liquidity remains a critical factor for traders and investors.

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