Bitcoin is trading at a steep discount to global liquidity trends, according to a new analysis from CF Benchmarks, even as macroeconomic headwinds from energy prices and monetary policy complicate the outlook for risk assets and economic growth.
The global M2 money supply has increased by around 12% since mid-2025, while Bitcoin has fallen by around 35% over the same period, the Kraken-owned index provider said.
A model cited in the report. reportreleased Thursday, implies a “fair value” of around $136,000, compared to Bitcoin’s current price near $70,000.
The divergence marks one of the widest gaps ever between Bitcoin and a metric long seen by analysts as an indicator of global liquidity. Historically, money supply expansion has spilled over into risk assets, with Bitcoin often reacting more strongly than stocks.
“The main takeaway from over a decade of data is that divergences between M2 and Bitcoin have always been temporary,” said Gabe Selby, head of research at CF Benchmarks. Decrypt in an emailed statement.
According to analysts, the missing link is US monetary policy. The Federal Reserve has reduced its balance sheet to approximately 6.7 trillion dollars from a peak of nearly $9 trillion in 2022 and keeps interest rates high, keeping financial conditions tight even as liquidity rises elsewhere.
This context has limited capital flows into markets, leaving Bitcoin more closely tied to real rates and broader risk sentiment than to overall money supply growth.
The elephant in the room
At the same time, rising energy prices are putting additional pressure on household finances.
Economists An estimated 81-cent increase in U.S. gasoline prices since late February could cost households about $740 over the year, potentially offsetting much of the increase in larger tax refunds.
In January, the White House projected that tax refunds for Americans would increase by an average of $1,000 this winter, compared to previous cycles, citing President Donald Trump’s Working Families Tax Cuts Act.
Markets also focused on potential disruptions to the Strait of Hormuz, a key artery for global oil supplies, and the resulting inflationary risks.
High rates and rising oil prices, driven by the ongoing conflict between the United States and Iran, have plagued markets in recent weeks, with oil surging above $100 a barrel on Thursday before falling to more modest levels near $92.
This combination risks curbing discretionary spending and reducing the pool of capital available to invest in higher-risk assets, including cryptocurrencies and growth stocks, if prices remain high.
Nonetheless, most experts say global economic growth could accelerate again if financial conditions ease and the Middle East conflict is contained, which would provide a major tailwind for crypto.
Past cycles suggest that Bitcoin tends to catch up with liquidity trends over a multi-quarter horizon, particularly when the Fed moves toward rate cuts or slows down its balance sheet reduction, according to CF Benchmarks.
The question is when?
Since the Biden administration’s post-pandemic stimulus measures, inflation has continued to filter through and wreak havoc on prices of goods and services, as the central bank sought to cut its benchmark rate to boost growth.
Today, markets face persistent inflation, foreign wars and monetary tightening, leading to uncertainty among participants about the direction of risk assets. And crypto, which has mostly trailed the Nasdaq, remains tied.
“An increase in demand via the TradFi vehicles that helped propel Bitcoin to all-time highs, namely spot Bitcoin ETFs and U.S.-listed corporate Treasuries, would provide more direct and mechanical support for a trend reversal,” Selby said.
“Continued purchases by these cohorts represent a source of structural demand that did not exist in previous cycles,” he added.