Bitcoin's (BTC) current trading behavior reflects one of the vital profound macroeconomic disruptions in years: global liquidity is rising while BTC continues to lag money supply growth and gold's record performance. A recent report from Bitwise suggested that this gap could lead on to a major asymmetric opportunity in Bitcoin by 2026.
Key Takeaways:
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Bitcoin is currently 66% below the worldwide money supply, implying a model-based fair value near $270,000.
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Gold took many of the monetary dilution in 2025 and now exceeds the worldwide M2 money supply by 75%.
Global liquidity is popping, but Bitcoin has not followed
A brand new edition of the Bitwise Monthly Bitcoin Macro Investor report argued that the underlying environment for Bitcoin is way more bullish than its current price motion. Global liquidity is now clearly turning toward reflation: the US issues nearly $1.9 trillion in Treasury bonds annually, President Donald Trump has promised $2,000 stimulus checks, and the Federal Reserve's quantitative tightening (QT) program ended on December 1st.
Macro indicator signals against Bitcoin growth. Source: Bitwise
At the identical time, Japan is putting together a $110 billion stimulus package, Canada has restarted quantitative easing (QE) and China has agreed to an enormous $1.4 trillion fiscal initiative. With greater than 320 global rate of interest cuts within the last 24 months, the worldwide M2 money supply has risen to a record $137 trillion.
With this in mind, Bitwise highlighted considered one of the most important valuation gaps in Bitcoin history. According to the corporate's cointegration model, BTC is currently underperforming the worldwide money supply by roughly 66%, implying a model-implied fair value of roughly $270,000. This separation resulted in a hypothetical upside potential of roughly +194% if Bitcoin returns to its long-term liquidity anchor.
Put simply, Bitcoin is undervalued relative to the extent of world monetary expansion, a dynamic that is essential because BTC's absolute scarcity has historically served as essentially the most sensitive barometer of monetary dilution, because the report notes.
Bitcoin is predicted to generate strong risk-adjusted returns in comparison with gold
Jurrien Timmer, director of world macro at Fidelity, said Bitcoin's trending constellation is currently lagging gold in momentum and Sharpe ratio metrics, putting the 2 assets in “polar opposites.”
The Sharpe ratio measures how much return an asset generates relative to its volatility, meaning gold is currently delivering a stronger risk-adjusted performance than Bitcoin. Although no trend reversal has been signaled yet, Timmer described this increasing divergence as a potentially compelling mean reversion situation.
Zooming out, Timmer noted that Bitcoin is broadly following its long-term power law acceptance curve despite its dip below $100,000. As BTC matures with limited parabolic returns, Timmer called BTC “the precocious, maturing younger sibling of gold,” still structurally strong, just less volatile.
This article doesn’t contain any investment advice or recommendations. Every investment and trading activity involves risks and readers should conduct their very own research when making their decision.
