TL;DR
- Jamie Coutts suggests the crypto market rally has significant growth potential, driven by global liquidity trends and the correlation with the global money supply (M2) metric.
- The increase in global liquidity is a bullish signal, supported by the strong correlation between active crypto addresses and the M2 metric.
- Bullish momentum from a weaker dollar and potential central bank interventions could further fuel the crypto market rally, with more governments likely to acquire Bitcoin.
Real Vision‘s chief digital assets analyst, Jamie Coutts, has provided an optimistic outlook for the cryptocurrency market, suggesting that the current rally is far from over. According to Coutts, global liquidity trends indicate that the crypto market bull cycle has significant room for growth.
Global Liquidity bullish momentum signal driven by a weaker dollar. Edging closer to central bank interventions. Looking for a break above mid-2024 high to confirm new regime. pic.twitter.com/yxUjPc08bq
— Jamie Coutts CMT (@Jamie1Coutts) February 19, 2025
The Role of Global Liquidity
Coutts emphasizes the importance of global liquidity in driving asset prices, including cryptocurrencies. He points out that the historical relationship between cryptocurrencies and the global money supply (M2) metric suggests that more rallies are on the horizon.
Coutts explains that global liquidity, combined with network activity and adoption, underpins the prices of digital assets. He highlights that the current uptrend in global liquidity is a bullish signal for the crypto market.
Active Crypto Addresses and M2 Metric
Coutts shares a chart that maps global liquidity against blockchain active addresses, revealing a strong correlation between the two.
He notes that active crypto addresses tend to follow the trend of the M2 metric, indicating that as global liquidity increases, so does the activity on blockchain networks. This correlation supports the idea that cryptocurrencies are a high-beta play on liquidity and a structural growth asset.
Bullish Momentum and Central Bank Interventions
The analyst also points out that the bullish momentum in global liquidity is driven by a weaker dollar and the potential for central bank interventions.
Coutts suggests that if global liquidity continues to rise, it could soon exceed the high from last year, further fueling the crypto market rally. He predicts that more governments will acquire Bitcoin (BTC) this year, as sovereign wealth funds and domestic Bitcoin mining operations accumulate the asset.
Jamie Coutts’ analysis provides a positive outlook for the cryptocurrency market, highlighting the critical role of global liquidity in driving asset prices. The correlation between active crypto addresses and the M2 metric suggests that the current rally has significant room for growth.
As global liquidity continues to increase, the crypto market is poised for further gains, with the potential for more governments to join the trend of accumulating Bitcoin.
