Global M2 data source: BGeometrics.com · model & styling by DurdenBTC.
What This Chart Shows
Bitcoin has tracked global liquidity more tightly than almost any other variable. This model regresses log(BTC) on log(global M2) — a straight line in log-log space — to turn the current money supply into a fair value for Bitcoin.
- Fair value (cyan) is where the model says Bitcoin “should” trade for today’s M2. The ±σ bands show how far price has historically wandered from it.
- Extreme shading on price: green when Bitcoin is a deep discount (z < −1.5) to liquidity, red when it is a bubble (z > +1.5).
- The liquidity z-score (lower panel) is the single number: how many standard deviations Bitcoin is above or below fair value. Green below, red above.
- The forward-return edge is shown up top: what price did over the next 6 months from each extreme, historically.
How to Read It
Read the z-score. Down in the deep-discount zone Bitcoin is cheap relative to the money that exists — historically a high-win-rate setup over the following six months. Up in the bubble zone it is expensive versus liquidity, and forward returns have been poor. Fair value drifts up over time because global M2 keeps expanding, which is the structural bull case in one line.
This is a slow, macro-scale gauge — M2 moves in weeks, not minutes — so treat it as a valuation anchor alongside trend and on-chain context, not a timing tool. The relationship can also break if the historical M2-to-Bitcoin link changes.
Drag to pan, scroll or box-zoom to zoom; the toolbar autoscales, resets or downloads the chart. Hover to read price, fair value and the z-score together.
Frequently Asked Questions
What is the fair value model?
A log-log regression of Bitcoin price on global M2: log(BTC) = α + β·log(M2). It has held at roughly R² = 0.92, so M2 explains most of Bitcoin’s long-run price.
What does the z-score mean?
How far price sits from fair value in standard deviations. Below −1.5 is a deep discount (strong forward returns historically); above +1.5 is a bubble (weak ones).
Where does the data come from?
Global M2 from BGeometrics.com; price from our daily feed. The regression and stats are computed in the browser. Updated daily.