In brief
- U.S. M2 money supply hit a record $22.02 trillion, but crypto markets continued to slide.
- Analysts say liquidity remains sidelined in money markets, not flowing into risk assets like crypto.
- High leverage, especially in altcoins, is driving forced selling and amplifying short-term volatility.
The U.S. money supply has climbed to a record high, but crypto markets continue to extend their decline, moving against a tide of rising liquidity.
The M2 money supply in the U.S. surged 4.5% year-over-year in June to a record $22.02 trillion, the Kobeissi Letter wrote in a tweet on Thursday.
The broad measure of money in circulation often correlates with asset prices, as increased liquidity tends to flow into markets, driving up inflation…
