Bitcoin (BTC) now represents approximately 1.7% of the global money supply, encompassing the combined M2 money supply data from all major fiat currencies, the largest minor currencies, and the market cap of gold, as reported by River, a Bitcoin financial services firm.
“In 16 years, Bitcoin achieved 1.7% of global money,” River stated. The company’s analysis compared Bitcoin’s market capitalization with a $112.9 trillion aggregate of fiat currencies and $25.1 trillion in hard assets, deliberately excluding silver, platinum, and rarer metals like palladium.
This evaluation is based on Bitcoin having a market cap of $2.4 trillion, which it surpassed earlier in August. Currently, BTC’s market cap is about $2.29 trillion, reducing its share of global money to approximately 1.66% as of now.
Bitcoin market cap versus global money. Source: River
Both Bitcoin and gold are increasing their portions of the global money market as central banks globally inflate their fiat currencies via excessive money creation, diminishing purchasing power and motivating investors toward hard assets.
Related: Crypto sentiment shifts to Greed as Bitcoin and Ether surge following Fed remarks
US Federal Reserve chair indicates upcoming rate cuts and ongoing monetary expansion
Jerome Powell, the chair of the United States Federal Reserve, gave a keynote speech at the Jackson Hole Economic Symposium in Wyoming on Friday, hinting at forthcoming interest rate reductions and persistent monetary expansion. Powell remarked:
“Our policy rate is now 100 basis points (BPS) nearer to neutral than it was a year ago, and the stability of the unemployment rate and other labor market indicators enables us to move cautiously as we contemplate alterations to our policy stance.”
In response to Powell’s address, Bitcoin’s price surged by over 2%, reaching around $116,000 per BTC on Friday.
Federal Reserve chairman Jerome Powell presents keynote speech at the Jackson Hole Economic Symposium. Source: Kansas City Fed
Typically, Bitcoin and other cryptocurrencies see appreciation during periods of monetary expansion, as the valuation of digital assets correlates with global liquidity conditions.
According to data from the Chicago Mercantile Exchange (CME) Group, 75% of investors currently expect a 25 basis points interest rate cut in September.
Magazine: Baby boomers with a net worth of $79T are increasingly adopting Bitcoin
