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Bitcoin’s blistering second-quarter advance is tracking the strongest expansion in global liquidity on record, according to Real Vision chief crypto analyst Jamie Coutts, who argues that every additional percentage point of liquidity injected into the financial system “should” translate into a 20% gain for the cryptocurrency.
1% Liquidity = 20% Bitcoin?
Writing on X, Coutts observed that his proprietary Global Liquidity Index broke to a fresh all-time high on 10 April after three years of drift and that, in the nine weeks since, Bitcoin has rallied about 40 percent. “Bitcoin has rallied 40% since April 10 which was when my global liquidity aggregate (GLI) after 3 years broke out to new all time highs on the back of a plummeting US dollar. Since then the aggregate is up 2%. Bitcoin’s Q2 rally is entirely consistent with liquidity regimes of this nature.”
He added that “while Bitcoin’s sensitivity to GLI moderates over time, for every extra 1 percent of liquidity added to the system we should expect to see a > 20 percent move in the price of Bitcoin,” he said, further claiming that the steady inflow of capital “doesn’t account for the inevitable ‘oh shit’ moment of panic buying that is going to happen… eventually. It will be best of times, it will be the worst of times.”
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The chart he shared, reproduced above, overlays his GLI (white) with daily Bitcoin prices (orange) from 2018 through June 2025. It shows the index pressing to roughly $138 trillion while Bitcoin changes hands near $108,000, underscoring the tight directional relationship between the two series across several liquidity cycles.
Coutts builds the indicator by combining G4 central-bank balance sheets, broad money aggregates such as M2, and key US liquidity accounts including the Treasury General Account and the Federal Reserve’s reverse-repo facility. Since the April breakout the GLI has added only about two percentage points, yet Bitcoin’s market value has already risen by twice the elasticity implied by his model—an outcome he considers “entirely consistent” with prior liquidity regimes, which tend to produce the sharpest price response early in the cycle.
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For now, he sees little evidence that the GLI’s momentum is cresting; with the Federal Reserve still draining its reverse-repo facility, the People’s Bank of China quietly expanding its balance sheet, and the European Central Bank hinting at renewed long-term refinancing operations, the backdrop remains structurally bullish even if it won’t be a straight line.
Looking further out, mainstream liquidity research suggests modest but persistent growth: most macro desks expect the global aggregate to rise roughly one to six percent over the next twelve months, three to eight percent cumulatively by mid-2027, and on the order of ten to fifteen percent by the turn of the decade as governments roll over record debt loads and central banks normalise balance-sheet policies. If Coutts’ rule of thumb holds, even the low end of those projections would leave ample headroom for triple-digit percentage gains in Bitcoin before 2030.
At press time, BTC traded at $107,676.
Featured image created with DALL.E, chart from TradingView.com
