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<p>Historical Bitcoin market cycles have been closely tied to M2 money supply and expanding liquidity.</p> 
<p>On Oct. 22, market analyst Michaël van de Poppe delved into data points and <a href="https://cryptopotato.com/the-big-influence-of-global-m2-money-supply-on-crypto-markets/" data-wpel-link="internal">correlations</a> with cycle peaks and money supply.&nbsp;He noted that in 2017, the M2 supply continued to expand significantly, and the cycle lasted until the end of the year, with BTC peaking at $20,000.</p> 
<p>During the 2021 bull market, the M2 supply surged, and crypto markets followed, peaking in November that year.&nbsp;However, the money supply continued to expand into 2022 but markets were kept depressed that year due to interest rate hikes and the collapses of several high-profile crypto companies.</p> 
<h2 id="money-supply-impacts">Money Supply Impacts</h2> 
<p>The analyst predicted that this cycle would be prolonged if the <a href="https://cryptopotato.com/bitcoin-emerges-as-key-liquidity-barometer-correlating-with-global-money-supply-trends-research/" data-wpel-link="internal">M2 money supply</a> kept expanding for another year and a half.</p> 
<blockquote>
 <p>“As a general thesis, if the M2 supply is expanded until mid-2026, the liquidity expansions will likely prolong the cycle.”</p>
</blockquote> 
<blockquote class="twitter-tweet"> 
 <p dir="ltr" lang="en">This chart shows a few super important data points that I think are important for this cycle.</p> 
 <p>– In 2016-2017 the M2 supply continued to expand significantly, through which the cycle lasted until the end of 2017.</p> 
 <p>– In 2021 the M2 supply basically went vertical, after which it… <a href="https://t.co/z1QuikfbVG" data-wpel-link="external" target="_blank">pic.twitter.com/z1QuikfbVG</a></p> 
 <p>— Michaël van de Poppe (@CryptoMichNL) <a href="https://twitter.com/CryptoMichNL/status/1848763766365655533?ref_src=twsrc%5Etfw" data-wpel-link="external" target="_blank">October 22, 2024</a></p>
</blockquote> 
<p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p> 
<p>The M2 money supply is a measure of the amount of currency in circulation. It includes M1 money, which is physical cash and deposits, in addition to currency that is “less liquid.”</p> 
<p>It is currently <a href="https://www.longtermtrends.net/m2-money-supply-vs-inflation/" target="_blank" rel="noopener" data-wpel-link="external">growing</a> at a rate of 2.59%, which has just surpassed the US <a href="https://cryptopotato.com/paul-tudor-jones-longs-bitcoin-as-all-roads-lead-to-inflation/" data-wpel-link="internal">inflation rate</a> of 2.44%. Moreover, it has been increasing since the beginning of this year and is currently $21.2 trillion, <a href="https://fred.stlouisfed.org/series/M2SL" target="_blank" rel="noopener" data-wpel-link="external">according</a> to the St. Louis Fed.</p> 
<p>Market Strategist Charlie Bilello commented on the growth rate, stating, “After a brief hiatus, money printing is back.”</p> 
<blockquote class="twitter-tweet"> 
 <p dir="ltr" lang="en">The US Money Supply grew 2.6% over the last year, the biggest YoY increase since August 2022. After a brief hiatus, money printing is back.<a href="https://t.co/l5IYmkeySJ" data-wpel-link="external" target="_blank">https://t.co/l5IYmkeySJ</a> <a href="https://t.co/j9YdcpX2A0" data-wpel-link="external" target="_blank">pic.twitter.com/j9YdcpX2A0</a></p> 
 <p>— Charlie Bilello (@charliebilello) <a href="https://twitter.com/charliebilello/status/1848903521162183040?ref_src=twsrc%5Etfw" data-wpel-link="external" target="_blank">October 23, 2024</a></p>
</blockquote> 
<p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p> 
<p>On Oct. 23, WeRate co-founder Quinten Francois also <a href="https://x.com/QuintenFrancois/status/1848817721712013743" target="_blank" rel="noopener" data-wpel-link="external">shared</a> the M2 growth chart, exclaiming, “A tsunami of printed money is coming and will push BTC into 6 figures.”</p> 
<h2 id="where-to-in-the-short-term">Where to in The Short Term?</h2> 
<p>BTC has retreated around 3% from its multi-month high of $69,500 on Oct. 21 to trade around the $67,000 level, where support was holding during Asian trading on Wednesday morning.</p> 
<p>Reflexivity Research co-founder Will Clemente observed that Bitcoin “is flipping last month’s highs into demand here,” suggesting that it could be forming a new support base to move higher.</p> 
<blockquote class="twitter-tweet"> 
 <p dir="ltr" lang="en">I rarely post about low time frame TA/price action, but looks like BTC is flipping last month’s highs into demand here. <a href="https://t.co/cyU1RweWx6" data-wpel-link="external" target="_blank">pic.twitter.com/cyU1RweWx6</a></p> 
 <p>— Will (@WClementeIII) <a href="https://twitter.com/WClementeIII/status/1848783451010338925?ref_src=twsrc%5Etfw" data-wpel-link="external" target="_blank">October 22, 2024</a></p>
</blockquote> 
<p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p> 
<p>Meanwhile, ‘Daan Crypto Trades’ <a href="https://x.com/DaanCrypto/status/1848810774837543174" target="_blank" rel="noopener" data-wpel-link="external">told</a> his 389,000 X followers that he doubts there will be a new all-time high before the US election on Nov. 5 “unless Trump’s odds drastically improve and the ETF inflows keep coming in,” before adding that the “base case is still relatively choppy between $65K-$70K until the election.”</p> 
<p>The post <a href="https://cryptopotato.com/expanding-m2-money-supply-signals-potential-extended-bitcoin-bull-market/" rel="nofollow">Expanding M2 Money Supply Signals Potential Extended Bitcoin Bull Market</a> appeared first on <a href="https://cryptopotato.com/" rel="nofollow">CryptoPotato</a>.</p>

Expanding M2 Money Supply Signals Potential Extended Bitcoin Bull Market

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