Global money supply has broken through the $103.66 trillion mark, yet Bitcoin and gold prices have not risen as expected, instead showing a significant divergence.
This anomalous phenomenon has sparked intense discussion on the X platform. Although most traders anticipated that an influx of capital would boost assets, actual market performance has revealed a deeper rupture in macroeconomic logic.
Structural differences in macroeconomic data are key to understanding this divergence. In August, the Federal Reserve, European Central Bank, Bank of Japan, and People's Bank of China collectively pushed money supply up by $1 trillion, marking the 10th consecutive month of growth.
According to data compiled by Woofun AI, the year-over-year growth rate of M2 denominated in US dollars is approximately 8%, but only 4.5% when calculated at fixed exchange rates. This growth rate is merely one-third of the peak level seen in 2021, with the weak dollar being the core variable causing the statistical discrepancy.
Breaking down individual economies, US M2 reached a historic high of $23.34 trillion, up 5.7% year-over-year; China's M2 grew 7.5%; the Eurozone's M3 grew 3.5%; and Japan's M2 declined slightly.
Notably, the Federal Reserve's balance sheet grew by only $141 billion over the past year, with no large-scale monetary expansion. This indicates that the increase in global liquidity mainly stems from operations by other central banks rather than direct money printing by the US dollar system.
Historical patterns show that Bitcoin prices are more sensitive to the growth rate of M2 than to its absolute total. During the price peaks of 2017, 2021, and 2025, M2 was in a period of relatively high growth; while the negative growth in late 2022 precisely corresponded to the market cycle low.
Macro analyst Lyn Alden pointed out in her 2024 research that over a 12-month observation period, Bitcoin's price movements matched the direction of global M2 changes with an 83% accuracy rate, far exceeding other assets.
However, since late 2025, M2 growth has slowed noticeably, which better explains Bitcoin's recent weakness than the record total money supply. Bitcoin is currently trading at around $84,650, with a 24-hour gain of only 0.7%, showing the market's strong reaction to slowing growth.
Real-world suppression factors have further exacerbated the plight of risk assets. On September 16, the Federal Reserve raised interest rates to the 3.75% to 4% range, the first rate hike since 2023. With oil prices near $100, the August CPI inflation rate remained at 3.4%.
According to TheStreet data, the 10-year US Treasury yield rose to 5.225%, the highest level since 2007. High yields significantly raise the valuation threshold for non-yielding assets. Gold prices fell to $4,163, down nearly 26% from their January peak. In contrast, the S&P 500 closed at 7,743 points, supported by positive news from the tech sector, showing relatively stable performance.
The key variable for the future market is whether M2 growth will accelerate again before interest rates begin to decline.
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