Bitcoin’s current bull run is poised to receive a significant boost from a surge in global liquidity, reaching a record high. New analysis conducted by Philip Swift, the creator of the on-chain data platform LookIntoBitcoin, indicates that worldwide liquidity is approaching $100 trillion.
The correlation between Bitcoin (BTC) and global liquidity trends is well-known in the crypto markets. With conditions in 2024 proving to be highly favorable for a potential increase in BTC price, Swift’s platform has been monitoring the world’s M2 money supply and comparing it to the behavior of Bitcoin’s price.
In terms of United States dollar, the M2 money supply has now reached $94 trillion, surpassing previous records and standing $3 trillion higher than when Bitcoin reached its previous all-time high of $69,000 in late 2021. Following a dip to $85 trillion in late 2022 at the low point of the crypto bear market, M2 has rebounded by 10%.
Swift emphasized the significance of this development, stating that “The most important chart for this bull run has just made a new all-time high.” The data aligns with recent findings based on liquidity, all of which point towards a bullish future for Bitcoin.
An analysis of BTC compared to the U.S. M1 money supply reveals a breakout from a seven-year consolidation period, with promising implications for price movement. Additionally, there is evidence of a growing interest among institutional investors in cryptocurrencies and risk assets as financial conditions become more favorable.
In a recent “Weekly Report” shared with Cointelegraph, the on-chain analytics platform CryptoQuant drew parallels between current investor behavior and that of 2020. Large investors are reportedly injecting approximately $1 billion into Bitcoin, reminiscent of the period before the rally from $10,000 to $70,000 in 2020.
A comparison of the realized price of new whale entities from 2020 to 2024 further emphasizes this trend. Moreover, there has been a notable increase in inflows to U.S. spot Bitcoin exchange-traded funds, with the second-highest net inflows recorded on June 4.
It is important to note that this article does not provide investment advice. All investment decisions involve risks, and readers are encouraged to conduct their own research before making any decisions.