Global Liquidity Updates

This model is a representation of Bitcoin's price trajectory over time, adjusted to account for global liquidity conditions.

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The core of this model is the Power-Law, which describes Bitcoin's price growth as a nonlinear, predictable pattern often used in financial systems. However, this baseline model has been refined by incorporating the year-over-year (YoY) percentage change in global liquidity, which reflects the total amount of money circulating in the global economy.

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It also includes upper and lower bands, calculated by multiplying the liquidity-adjusted power-law model by a specific multiplier. For instance, the upper band might be 1.7 times the base model, while the lower band is a fraction of it, outlining a plausible price range given market variability.

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These bands represent probabilistic ranges, not direct predictions, capturing uncertainty and potential price fluctuations. They enhance the model's ability to explain historical price trends and visualize future possibilities within the context of global liquidity dynamics.

Our Liquidity Oscillator remains positive, but early signs of momentum slowing are visible - indication that liquidity flows are weakening.

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In total, Bitcoin has seen a 23% surge since our model went positive.

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The Treasury General Account seems to have started its rundown, currently sitting at $754bn, potentially driving strong inflows into the markets until EOY and possibly even into Q1 of '25.

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General outlook remains positive, with every dip being a potential golden opportunity as stated previously - do not allow yourself to get fudded out of your bags.

The AE Global Liquidity Indicator remains flat at around $130 trillion, with the 3-month RoC maintaining a bullish bias.

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Interestingly, while the RRP is at its low levels and the MOVE Index shows continued stabilization, last week saw a $36 billion Treasury rundown.

Could this mark the beginning of the anticipated liquidity events we talked about recently?

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This suggests that despite the lack of significant upward momentum, current liquidity conditions remain supportive which, in the near term, may be a plus for assets like Bitcoin.

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One development worth tracking is who Trump appoints to the position of Treasury Secretary.

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The current two front-runners are Scott Bessent and Howard Lutnick. Both of these individuals have proven to be crypto-friendly. Of course, Lutnick was with Tether, which may mean his appointment could lead to quite a bit more volatility in the market, possibly more bullish movements.

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The new Treasury Secretary will oversee national debt and fiscal policy, shaping the economic landscape. Replacing Janet Yellen with a Wall Street figure signals a likely shift toward market-friendly policies-a positive for Bitcoin and broader virtual currencies. Such a pivot could accelerate crypto adoption and deregulation.

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The potential for aggressive market expansion under a crypto-friendly Treasury could have profound implications for digital assets that the crypto community has been looking for.