Crypto Traders Eye Bullish Signal: M2 Money Supply Turns Positive

Bitcoin's recent slump may ease up as the M2 money supply flips positive year-over-year for the first time since late 2022. This shift often triggers investor interest in hedges against inflation, like Bitcoin.

Crypto analysis firm Glassnode noted an uptick in Bitcoin "outflows" throughout April, suggesting selling pressure. This coincided with a 9.75% price drop for Bitcoin in the last month.

However, the M2 money supply, a measure of cash and short-term deposits, turned positive on May 1st. This indicates an increase in money circulation, historically linked to investor preference for assets that perform well during inflation.

The positive shift in M2 has crypto traders speculating on Bitcoin's price recovery, as the supply has been negative since November 2022.

Financial experts like Oliver Velez and InvestAnswers are expressing bullish sentiment on social media, citing the M2 uptick as a potential catalyst for Bitcoin's rise.

This aligns with Raoul Pal's October 2023 statement highlighting M2's role in Bitcoin outperforming traditional markets.