The chart shows that the U.S. money supply M2 reached a record high of $21.9 trillion in May 2025, with an annual growth rate of 4.5%. The compound annual growth rate from 2000 to 2025 is 4.3%. M2 includes cash, checking deposits, savings accounts, and other liquid assets. There has been significant growth momentum following the 2008 global financial crisis and the 2020 COVID-19 pandemic, the latter of which saw a substantial increase in money supply due to expansionary monetary policy. According to the Federal Reserve, M2 has grown for 19 consecutive months, surpassing the previous high of $21.86 trillion set in March 2022. Adjusted for inflation, M2 has increased by 2.1% year-on-year, the highest level since early 2022. Analyzing the trend of monetary expansion: the strong year-on-year growth of 4.5% indicates that liquidity injection is ongoing, likely achieved through the Fed's low interest rates or quantitative easing measures. This aligns with the historical pattern of M2 surging after economic crises, indicating that the government has taken proactive measures to stimulate the economy. Inflation impact: The 2.1% real M2 growth rate is higher than recent inflation trends, which may signal potential inflationary pressures. Excess liquidity typically leads to increased spending, and unless countered by tightening policies, it will drive up prices. Asset impact: M2 growth has historically been associated with bullish trends in risk assets. The current expansion, coupled with a 45% increase since 2020 ($7 trillion), may lead capital to shift towards alternative investments. The #Bitcoin and #cryptocurrency markets may show increased interest as a hedge against inflation. Long-term background: The compound annual growth rate of the money supply over 25 years is 4.3%, accelerating since 2020 (some analyses indicate a compound annual growth rate of 7.9% from 2020 to 2024), reflecting an active monetary policy. If liquidity is maintained, this could support rising asset prices. Conclusion: The M2 money supply reaching a record $21.9 trillion indicates a strong liquidity environment, which could support inflation and rising asset prices. Due to concerns about currency depreciation, investors may increasingly turn to cryptocurrencies and Bitcoin as a store of value. The consecutive 19 months of growth and the surge after 2020 suggest that risk assets are entering a long-term growth phase, although future actions by the Fed (such as interest rate hikes) may alter this trajectory. Monitoring inflation-adjusted M2 money supply and Fed policies is crucial for assessing the sustainability of this trend. This analysis reflects current data and market sentiment, as the monetary environment evolves.#altcoins and #blockchain 's popularity potential will continue to increase
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