Experts Forecast Significant Bitcoin Surge in Late March Amid Rising M2 Money Supply

Recent evaluations by cryptocurrency analysts indicate that the price movements of Bitcoin (BTC) demonstrate a strong correlation with the global M2 money supply. This relationship has led them to forecast a bullish trend for the cryptocurrency market beginning in late March.

With increased liquidity in global markets, experts suggest Bitcoin and other digital assets could see substantial growth starting around March 25, 2025, and extending through mid-May.

Understanding Global M2 and Its Impact on Bitcoin

The M2 money supply is a broad measure of liquid assets that includes cash, checking deposits, and easily convertible near-money assets. Historically, increases in global M2 have coincided with heightened demands for alternative financial assets such as cryptocurrencies.

Colin Talks Crypto, an analyst on X (Twitter), has drawn attention to this correlation, noting the recent sharp rise in the global M2 as a potential precursor to a major increase in asset prices. He characterized the trend as a 'vertical line' on the chart, suggesting a robust forthcoming rally for stocks, Bitcoin, and the larger cryptocurrency market.

“The Global M2 Money Supply chart just printed another vertical line. The rally for stocks, Bitcoin, and crypto is going to be epic,” he stated.

Vandell, co-founder of Black Swan Capitalist, concurs that changes in global M2 directly influence Bitcoin’s pricing. He observed that downturns in M2 typically see corresponding declines in Bitcoin and the broader cryptocurrency market approximately ten weeks later. Despite potential short-term fluctuations, Vandell believes this cycle could lay the groundwork for a significant long-term upward movement.

“As seen recently, when global M2 declined, Bitcoin & crypto followed roughly 10 weeks later. While further downside is possible, this drawdown is a natural part of the cycle. This liquidity shift will likely continue throughout the year, setting the stage for the next leg up,” Vandell explained.

Another notable analyst, Michaël van de Poppe, views the expansion of M2 as a key indicator for an early recovery in the market. With inflation fading as a primary concern and anticipated cuts from the US Federal Reserve, financial conditions seem increasingly favorable for Bitcoin.

“Bottom line is: Inflation isn’t the prime topic, likely to go down. FED rate cuts. The dollar to weaken massively. Yields to fall. M2 Supply to significantly expand. And as this process started, it’s just a matter of time until altcoins and crypto pick up. Bull,” he remarked.

Historical Trends and Future Projections

The strong correlation between Bitcoin’s value and the growth of the global M2 money supply is not a recent phenomenon. Tomas, a macroeconomist, noted that similar conditions were observed during previous market cycles in 2017 and 2020 when significant M2 increases coincided with Bitcoin's most notable annual surges.

“Money supply is expanding globally. The last two major global M2 surges occurred in 2017 and 2020—both coincided with mini ‘everything bubbles’ and Bitcoin’s strongest years. Could we see a repeat in 2025? It depends on whether the U.S. dollar weakens significantly,” Tomas noted.

Additionally, he emphasized the influence of central bank policies. While major financial institutions are currently cutting rates, the strength of the US dollar may play a critical limiting role. A decline in the dollar index (DXY) to around 100 or lower could mirror the conditions seen in past Bitcoin bull runs.

The Federal Reserve's Potential Impact

Macro researcher Yimin Xu believes the Federal Reserve may consider halting its Quantitative Tightening (QT) measures in the latter half of the year. According to Xu, economic conditions could necessitate a shift towards Quantitative Easing (QE), which would inject more liquidity into the markets and potentially boost Bitcoin's ascension.

“I think reserves could get too thin for the Fed’s liking in the second half of the year. I predict they will terminate QT in late Q3 or Q4, with possible QE to come after,” Xu commented.

Tomas echoed Xu's sentiments, indicating that the Fed intends to gradually increase its balance sheet in alignment with GDP growth. He highlighted that a major financial event might trigger a decisive return to QE.

While uncertainties about the dollar's strength and potential economic upheavals linger, a consensus among analysts points toward an impending bullish phase for Bitcoin. Investors are encouraged to monitor macroeconomic indicators closely in the upcoming months, as they prepare for the anticipated rally.