Experts like the crypto analytics account Cryptollica on X and Joe Consorti, Head of Growth at Theya Bitcoin, highlight the growing M2 supply and its historical link to Bitcoin’s performance. M2 includes cash and highly liquid assets that can be easily converted into cash. Historically, when M2 increases, investors have more capital available, often leading to a rise in risk asset values such as Bitcoin. Due to its limited supply, Bitcoin continues to be seen as a strong hedge against inflation.
A report from China News reveals that China’s M2 supply grew by 7% year over year in Q1 2025, driven by fresh cash injections that boosted the country’s credit supply, with a net addition of 249.8 billion Yuan. Notably, this trend isn’t unique to China. The global M2 money supply has also risen by $4.5 trillion so far this year. Meanwhile, the European Central Bank (ECB) has implemented seven interest rate cuts over the past year, highlighting a broader global shift toward quantitative easing.
Gold’s Performance Boosts Confidence in Bitcoin
Analysts are also highlighting gold’s recent performance as an indicator for Bitcoin’s potential trajectory. While some market watchers argue that Bitcoin’s struggles compared to gold’s strong gains this year suggest a divergence between the two assets, many experts believe otherwise.
Cryptollica expects Bitcoin to eventually mirror gold’s performance, setting a midterm price target of $155,000 for BTC. Consorti shares this perspective, emphasizing that Bitcoin often trails gold’s movements, typically with a delay of about 100 to 150 days.
Interestingly, many experts also agree that Bitcoin has shown strong performance in recent months. CoinDesk Senior Analyst James Van Straten shared on X that he believes Bitcoin remains in a bull market and that the recent 30% correction was anticipated.
He also expressed surprise at how well BTC has held up compared to U.S. equities, pointing out that this sentiment is echoed by several figures in traditional finance. He stated:
Is Altcoin Season on the Horizon?
Many experts suggest that the surge in M2 supply could benefit not just Bitcoin, but also signal the beginning of the long-awaited altcoin season. Cryptollica pointed out that increases in M2 often coincide with the start of altcoin rallies, while crypto entrepreneur Techdev remarked, “Altcoins don’t take off until liquidity breaks out.”
However, if an altcoin season is approaching, there’s little evidence of it so far. According to the CoinMarketCap index, it’s currently Bitcoin season. The chart indicates that altcoin season begins when 75% of the top 100 tokens (excluding stablecoins) outperform Bitcoin over the past 90 days—but the index currently sits at just 19%.
Despite growing optimism among analysts, several uncertainties remain. The ongoing US-China trade war, for instance, could escalate unexpectedly and negatively affect the market. Additionally, the U.S. Federal Reserve continues to take a cautious, hawkish stance. Fed Chair Jerome Powell has stated that no decisions on interest rates will be made until the full effects of tariffs are assessed.
