Bitcoin Magazine
Why Liquidity Matters More Than Ever For Bitcoin
Global liquidity has long been one of the cornerstone indicators used to assess macroeconomic conditions, and particularly when forecasting Bitcoin’s price trajectory. As liquidity increases, so does the capital available to flow into risk-on assets, such as Bitcoin. However, in this evolving market landscape, a more responsive and perhaps even more accurate metric has emerged, one that not only correlates highly with BTC price action but is also specific to the ecosystem.
Global M2
Let’s begin with the Global M2 vs BTC chart. This has been one of the most shared and analyzed charts on Bitcoin Magazine Pro throughout the current bull cycle, and for good reason. The M2 supply encompasses all physical currency and near-money assets in an economy. When aggregated globally across major economies, it paints a clear picture of fiscal stimulus and central bank behavior.
Figure 1: The Global M2 vs BTC chart has established itself as a key forecasting metric. View Live Chart
Historically, major expansions in M2, especially those driven by money printing and fiscal interventions, have coincided with explosive Bitcoin rallies. The 2020 bull run was a textbook example. Trillions in stimulus flooded global economies, and Bitcoin surged from the low thousands to over $60,000. A similar pattern occurred in 2016-2017, and conversely, periods like 2018-2019 and 2022 saw M2 contraction aligning with BTC bear markets.
A Stronger Correlation
However, while the raw M2 chart is compelling, viewing Global M2 vs BTC Year-on-Year provides a more actionable view. Governments tend to always print money, so the base M2 supply nearly always trends upward. But the rate of acceleration or deceleration tells a different story. When the year-over-year growth rate of M2 is rising, Bitcoin tends to rally. When it’s falling or negative, Bitcoin typically struggles. This trend, despite short-term noise, highlights the deep connection between fiat liquidity expansion and Bitcoin’s bullishness.
Figure 2: Switching to the Global M2 vs BTC YoY chart reveals a stronger correlation between these two metrics. View Live Chart
But there’s a caveat: M2 data is slow. It takes time to collect, update, and reflect across economies. And the impact of increased liquidity doesn’t hit Bitcoin immediately. Initially, new liquidity flows into safer assets like bonds and gold, then equities, and only later into higher volatility, speculative assets like BTC. This lag is crucial for timing strategies. We can add a delay onto this data, but the point remains.
Stablecoins
To address this latency, we pivot to a more timely and crypto-native metric: stablecoin liquidity. Comparing BTC to the supply of major stablecoins (USDT, USDC, DAI, etc.) reveals an even stronger correlation than with M2.
Figure 3: Historically, changes in stablecoin liquidity have coincided with Bitcoin cycles.
Now, just tracking the raw value of stablecoin supply offers some value, but to truly gain an edge, we examine the rate of change, particularly over a 28-day (monthly) rolling basis. This change in supply is highly indicative of short-term liquidity trends. When the rate turns positive, it often marks the beginning of new BTC accumulation phases. When it turns sharply negative, it aligns with local tops and retracements.
Figure 4: Plotting the stablecoin supply rate of change shows how liquidity trends tightly align with BTC price action.
Looking back at the tail end of 2024, as stablecoin growth spiked, BTC surged from prolonged consolidation into new highs. Similarly, the major 30% drawdown earlier this year was preceded by a steep negative turn in stablecoin supply growth. These moves were tracked to the day by this metric. Even more recent rebounds in stablecoin supply are starting to show early signs of a potential bounce in BTC price, suggesting renewed inflows into the crypto markets.
Figure 5: In the past, the indicator triggered by the liquidity rate crossing above zero has been a reliable buy signal.
The value of this data isn’t new. Crypto veterans will remember Tether Printer accounts on Twitter dating back to 2017, watching every USDT mint as a signal for Bitcoin pumps. The difference now is we can measure this more precisely, in real-time, and with the added nuance of rate-of-change analysis. What makes this even more powerful is the intracycle and even intraday tracking capabilities. Unlike the Global M2 chart, which updates infrequently, stablecoin liquidity data can be tracked live and used on short timeframes, and when tracking for positive shifts in this change, it can provide great accumulation opportunities.
Conclusion
While Global M2 growth aligns with long-term Bitcoin trends, the stablecoin rate-of-change metric provides clarity for intra-cycle positioning. It deserves a spot in every analyst’s toolkit. Using a simple strategy, such as looking for crossovers above zero in the 28-day rate of change for accumulation, and considering scaling out when extreme spikes occur, has worked remarkably well and will likely continue to do so.
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Disclaimer: This article is for informational purposes only and should not be considered financial advice. Always do your own research before making any investment decisions.
This post Why Liquidity Matters More Than Ever For Bitcoin first appeared on Bitcoin Magazine and is written by Matt Crosby.
Japanese investment firm Metaplanet has injected $5 billion into its U.S. subsidiary, Metaplanet Treasury Corp., as part of its plan to grow its bitcoin (BTC) holdings and expand globally in the digital asset space. The funds will be used to accelerate the company’s “555 Million Plan” to buy up to 210,000 BTC by the end of 2027—1% of bitcoin’s total supply. Metaplanet has already made good progress, recently increasing its holdings to 11,111 BTC, worth over $1.1 billion. Metaplanet allocates $5 billion to its wholly owned U.S. division Metaplanet’s U.S. arm, Metaplanet Treasury Corp, launched in May 2025, and based in Florida, is a key part of the company’s strategy. Florida and Miami in particular have become pro-Bitcoin havens, and digital asset infrastructure is growing. By entering the U.S. market, the company will benefit from deep capital markets, institutional infrastructure and transparent regulations to buy and manage large amounts of bitcoin. The company will access both exchange and over-the-counter (OTC) markets for large BTC purchases. “This U.S. expansion underscores our determination to establish a globally integrated treasury model,” Metaplanet said in a statement. “The Company believes this approach will drive long-term accretion to shareholder value, enhance treasury yield efficiency, and reinforce our positioning at the forefront of Bitcoin-based capital market innovation.” The $5 billion will be funded by exercising stock acquisition rights from previously issued convertible securities. The funds will be used exclusively for bitcoin purchases with no change to the use of proceeds as previously disclosed. The “555 Million Plan” was announced on June 6, 2025 and outlines Metaplanet’s path to becoming one of the world’s largest corporate bitcoin holders. The company will buy 30,000 BTC by the end of 2025, and 210,000 BTC over the next few years. This is not just a financial move but a strategic one. It’s about building a transparent, efficient and global treasury on bitcoin. Metaplanet’s stock has gone up over 1,250% in the last 6 months and part of that is due to their aggressive push into bitcoin. But the recent announcement has caused short-term volatility in the stock. After hitting $15 the U.S.-listed MTPLF, shares dropped to $10.9 and the Tokyo-listed shares dropped 5.38% closing at 1,547 JPY. MTPLF price chart — TradingView Despite the dip, institutional investors are showing strong interest. Citigroup and Capital Group have reportedly bought 3 million shares of Metaplanet this month. Analysts see this as a sign of growing confidence in bitcoin-focused corporate strategies. Some analysts are worried about the premium in Metaplanet’s stock and say it’s pricing bitcoin at $596,000 to $759,000 per coin—way above current market prices. This has sparked debate about sustainability and stock dilution but also shows investors want bitcoin exposure through equities. Metaplanet is part of a growing trend of public companies adding bitcoin to their treasuries. Over 240 public companies now hold over 832,000 BTC combined, according to BitcoinTreasuries. Companies like Cardone Capital, Nakamoto Holdings and CleanSpark are also increasing their bitcoin reserves.
Japanese investment firm Metaplanet has officially surpassed Elon Musk’s Tesla to become one of the largest corporate holders of bitcoin in the world. With a recent purchase of 1,234 BTC, the company now holds 12,345 BTC worth around $1.33 billion. This big move puts the Tokyo-listed company ahead of Tesla’s 11,509 BTC and makes it the 7th largest corporate bitcoin holder globally. The latest purchase cost Metaplanet around $132.7 million, made at an average price of $107,557 per bitcoin. The company has spent around $1.2 billion in total to buy 12,345 BTC, averaging a cost basis of $97,036 per coin. Metaplanet CEO Simon Gerovich announced the company now holds 12,345 BTC and reiterated its commitment to a bitcoin-focused strategy for long-term shareholder value. In just 2 weeks the Japanese firm has moved from 10th to 7th place among all corporate bitcoin holders, surpassing big companies like Coinbase, Block Inc. and Hut 8. Metaplanet, originally a budget hotel company, has transformed into a bitcoin-treasury-focused investment firm. Its strategy is inspired by Michael Saylor’s Strategy, the largest corporate bitcoin holder with over 590,000 BTC. Unlike Strategy, Metaplanet has chosen a more conservative approach by not using debt to buy bitcoin. Instead, it raised funds through equity sales. Just a day before the latest bitcoin purchase the company completed a ¥74.9 billion (around $515 million) equity raise, issuing 54 million new shares backed by institutional investors like EVO FUND. This is the largest single-day equity-based bitcoin treasury event ever recorded. Metaplanet isn’t stopping at 12,345 BTC. It has set ambitious targets: to buy 30,000 BTC by the end of 2025, 100,000 by 2026 and 210,000 by 2027. These are part of what the company calls its “555 Million Plan” which involves raising up to $5 billion to buy more bitcoin. The company has already made 2 big purchases—1,111 BTC a few days ago and 1,234 BTC yesterday—and has increased its bitcoin holdings by nearly 10x since January. Metaplanet bitcoin purchase history — BitcoinTreasuries The bitcoin buying has had mixed effects on Metaplanet’s stock. After a 25% drop from its recent high of 1,900 JPY, the company’s stock has stabilized at around 1,560 JPY. Some see the dip as a buying opportunity. Gerovich said he believes trading volume is the “lifeblood” of a bitcoin treasury firm, pointing out Metaplanet’s $840 million daily trading volume. Trading volume of different companies — Simon Gerovich on X Despite the growth, the company has attracted the attention of hedge funds, some of which have shorted the stock due to concerns over shareholder dilution from the rapid equity issuance. But Metaplanet’s decision to not use debt is seen by others as a protection against long-term financial risk. Metaplanet’s big bet is happening during a broader bitcoin boom. Bitcoin prices are up to $107,000, 1.5% in the day and 74% since late June 2024. Analysts point to geopolitical stability and the Fed not raising rates as the reason for the market confidence.
Digital asset platform Bakkt Holdings Inc. has filed a shelf registration with the U.S. Securities and Exchange Commission (SEC) to raise up to $1 billion. The company says the funds could be used to support a new bitcoin and digital asset investment strategy, a big change for the company. Bakkt, which is publicly traded and backed by Intercontinental Exchange (ICE)—the parent company of the New York Stock Exchange—said it may sell a mix of common stock, preferred shares, debt instruments and warrants. The money raised could be used for general corporate purposes or to buy bitcoin for its corporate treasury. “We may acquire Bitcoin or other digital assets using excess cash, proceeds from future equity or debt financings, or other capital sources,” the company said in its SEC filing. The shelf registration, filed June 26, allows Bakkt to offer these securities at any time, as needed. This gives the company the flexibility to raise funds quickly without having to file new paperwork each time it wants to sell securities. This follows a big decision by the company’s Board of Directors on June 10 when it approved an updated investment policy. The new policy allows the company to include bitcoin and other digital assets as part of its broader treasury and corporate strategy. Bakkt updated its investment policy Although Bakkt has not yet purchased any bitcoin, the company says it’s preparing for the right moment. The company said when and how much digital assets it buys will be based on market conditions, how the capital markets respond, the company’s financial performance, and other strategic priorities. Founded in 2018, Bakkt initially offered physically-settled bitcoin futures. Over the years, it also tried tokenized loyalty rewards and digital asset custody services, but those efforts have not gained much traction. Now the company is positioning itself as a “pure-play crypto infrastructure company” with international expansion and digital treasury management in its sights. “This initiative is intended to support Bakkt’s transformation into a pure-play crypto infrastructure company,” said Akshay Naheta, Co-CEO of Bakkt. “We believe this multi-pronged approach reflects our conviction in the future of digital assets and our vision for Bakkt’s expansion internationally and as a leader in the world of programmable money.” The company’s leadership also mentioned emerging global opportunities, particularly in Asia where countries like Singapore and Hong Kong have more regulatory clarity and liquidity in the digital asset space. “Bakkt’s jurisdiction-flexible strategy is well-positioned to succeed in Asia,” said Charmaine Tam of Hex Trust. He noted markets like Hong Kong and Singapore have clear regulations, deep liquidity and mature financial systems, perfect for the firm’s institutional digital asset play. Despite its big plans, Bakkt is still struggling financially. The company admitted in the filing that it has a “limited operating history” and a “history of operating losses.” It also lost some big clients recently, including Bank of America and Webull, who declined to renew their contracts. This has raised questions about the company’s long-term viability.
Bitcoin is making waves on Wall Street as institutional investors increase their exposure through exchange-traded funds (ETFs). Recent data shows that spot Bitcoin ETFs now hold over 1.24 million BTC, which is about 6% of the total circulating supply. This is a big deal for Bitcoin’s integration with traditional finance. Bitcoin ETFs’ holdings — WalletPilot ETF giants like BlackRock, Fidelity and others are still buying bitcoin despite global tensions, high interest rates and market uncertainty. These holdings have been growing since the launch of spot Bitcoin ETFs in early 2024 and reflect the growing institutional demand for the scarce digital asset. Even during recent geopolitical turmoil, Bitcoin ETFs didn’t flinch. Over the last two weeks, as tensions escalated in the Middle East, ETFs had 10 straight days of inflows, according to Farside Investors. Bitcoin ETFs’ flows in June 2025 — Farside Investors “Institutional demand for Bitcoin doesn’t flinch easily,” said Ecoinometrics on social media platform X. “The streak is still intact and that sets the stage for Bitcoin’s upside potential to play out.” Bitcoin ETFs didn’t break during global stress. That’s a change in investor behavior. As Dragonfly data analyst Hildebert Moulie pointed out, ETF investors are no longer just speculating — they are allocating long-term. That means institutional investors now view bitcoin as a core portfolio asset. Reports from CryptoQuant and other analysts show that the average purchase price for most ETF-held bitcoin is around $73,000, excluding Grayscale’s GBTC fund. They believe that’s the current key psychological and technical support level. That’s important because many institutional investors are conservative. They typically aim for 40-50% profits before they sell. Given bitcoin is trading between $105,000 and $107,000, many ETF investors are getting close to that profit window. But analysts say they are not in a rush to exit. The Market Value to Realized Value (MVRV) ratio — a metric to measure profitability — is at 1.43 for ETF holdings. That’s well below the historical peak of 3.7 which was seen before previous big sell-offs. So there’s still room to grow before institutions feel pressure to take profits. BlackRock still leads the ETF market with 695,829 BTC under management, controlling over 52% of all ETF-held bitcoin. Fidelity and other firms are also adding to the growing pool of BTC held in these regulated products. With only 21 million BTC ever to exist and over 1.23 million BTC locked away in ETFs, supply is getting tight. If demand keeps rising this could lead to a supply shock. The bitcoin in ETFs is essentially locked away, not available for trading on exchanges unless there are large outflows. That’s what makes this such a big structural shift. Even with rising geopolitical risks and market volatility, ETF investors are calm. As Bloomberg’s ETF expert Eric Balchunas said back in April, these holders have “stronger hands than most think”. He credits them for absorbing sell pressure from short-term holders and even from large liquidations like the FTX collapse. Eric Balchunas on X