The post US M2 Reaches Record $22.3T, Potentially Enhancing Bitcoin’s Liquidity Cycle Amid Rate Cuts appeared on BitcoinEthereumNews.com.

The Bitcoin liquidity cycle is gaining momentum as the U.S. M2 money supply hits a record $22.3 trillion, signaling accelerated liquidity that historically boosts Bitcoin prices amid Federal Reserve rate cuts and balance sheet expansions. U.S. M2 money supply reaches $22.3 trillion, a new peak fostering a favorable environment for Bitcoin’s liquidity cycle and potential market rallies. Anticipated Federal Reserve rate cuts enhance liquidity flows, directing capital toward Bitcoin and other high-risk digital assets. Projections for T-bill purchases starting in 2026, combined with a weakening dollar, align with past crypto bull runs, per data from financial analysts. Discover how the surging U.S. M2 money supply to $22.3T ignites the Bitcoin liquidity cycle. Explore rate cuts, dollar trends, and market implications for crypto investors today. What Is the Bitcoin Liquidity Cycle and How Does U.S. M2 Growth Influence It? The Bitcoin liquidity cycle refers to the pattern where increased global liquidity, particularly from expansions in the U.S. M2 money supply, drives capital into risk assets like Bitcoin, often preceding significant price rallies. As M2 recently climbed to a record $22.3 trillion, this cycle is accelerating, mirroring historical patterns from 2020-2021 where liquidity surges led to Bitcoin’s multi-fold gains. Financial experts emphasize that such expansions reduce borrowing costs and encourage investment in digital assets, setting the stage for renewed market optimism. How Does Federal Reserve Rate Cuts Impact the Bitcoin Liquidity Cycle? Federal Reserve rate cuts play a pivotal role in the Bitcoin liquidity cycle by lowering interest rates, which makes holding non-yielding assets like Bitcoin more attractive compared to traditional fixed-income options. Recent data indicates the Fed’s anticipated continued reductions in 2025 could inject substantial liquidity into markets, with projections estimating monthly T-bill purchases of around $40 billion by early 2026, according to analysis from UBS. This shift eases funding pressures…

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Filed under: News - @ December 7, 2025 6:24 pm