Crypto Insights Daily – March 11, 2025 🚀
- Crypto Alpha
- Mar 11
- 6 min read
Updated: Mar 12
March 11, 2025
Market Overview
The cryptocurrency market has faced significant volatility over the past 24 hours, influenced by recent policy announcements and economic uncertainties. From yesterday's lows:
Market Metrics
Total Cryptocurrency Market Capitalization: Stands at $2.61 trillion, an increase of $900 billion from the previous day.
Bitcoin Dominance (BTC.D): Holds at 461.9%, indicating Bitcoin's continued influence in the market.
Altcoin Market Capitalization: Around to $995 billion, reflecting broader market declines.
Note: Cryptocurrency market metrics are highly dynamic and can change rapidly. For the most current information, refer to reliable financial news sources or real-time market data platforms.
📈 Current Market Sentiment
Crypto Fear & Greed Index: 15 (Extreme Fear)
Investor Outlook: The market exhibits heightened caution, with investors closely monitoring policy developments and economic indicators.
The Fear & Greed Index at 15 suggests a state of extreme fear, indicating potential buying opportunities for contrarian investors.
Note: The Crypto Fear & Greed Index is a tool that measures the prevailing sentiment of the cryptocurrency market, ranging from 0 (Extreme Fear) to 100 (Extreme Greed). It helps investors gauge market emotions, which can influence buying and selling decisions.
For a historical view of the Crypto Fear and Greed index check out this site below.
🔥 Daily Highlights
1. Coinbase Registers with Indian Financial Watchdog to Offer Crypto Trading Services
Coinbase Global, a leading U.S.-based cryptocurrency exchange, has successfully registered with India's Financial Intelligence Unit (FIU), paving the way to launch crypto trading services in the country later this year. This strategic move aligns with the growing interest in cryptocurrencies among young Indian investors and positions Coinbase alongside other major exchanges like CoinDCX, Binance, and KuCoin already operating in India. The company emphasizes its commitment to complying with local regulations, marking a significant step in expanding its global footprint.
2. Strategy Faces Losses Amid Bitcoin Price Decline
Strategy, formerly known as MicroStrategy, has invested approximately $21.2 billion in Bitcoin since November 10. However, the recent downturn in Bitcoin's price has reduced the value of these holdings to about $17.3 billion. This depreciation has led to a significant drop in Strategy's stock value, reaching its lowest closing price since Election Day. The company's aggressive Bitcoin acquisition strategy, funded through stock offerings and debt, is now under scrutiny as market conditions remain volatile.
3. Bitcoin Hits Four-Month Low Amid Market Selloff
Bitcoin's price recently plummeted to a four-month low, touching $76,867 before rebounding slightly above $80,000. This decline contributes to a 14% decrease in Bitcoin's value in 2025, leaving it 26% below its all-time high. Factors influencing this downturn include investor disappointment over President Donald Trump's cryptocurrency reserve announcement, which lacked plans for active government purchasing, and a broader shift away from risky assets due to economic slowdown concerns. Analysts anticipate continued volatility in the cryptocurrency market, with potential rebounds hinging on unforeseen positive developments.
Deep Dive: M2 Money Supply and Crypto: Why the Current Trend is Favorable for Digital Assets
The M2 money supply is one of the most critical indicators of economic liquidity and inflationary trends. It represents the total amount of money in circulation, including cash, checking deposits, and easily accessible savings. As central banks manipulate the money supply to control inflation and economic growth, the implications for crypto markets are profound.
Understanding M2's trends is crucial for assessing the future of digital assets. Right now, the M2 money supply trend is turning bullish for crypto, and in this article, we’ll break down why.
What Is M2 Money Supply?
M2 is a broad measure of the money supply that includes:
M1 Money (Most Liquid): Physical cash, coins, and checking account deposits.
Savings Accounts & Time Deposits: Less liquid but still easily converted into cash.
Retail Money Market Funds: Investments that provide liquidity while offering some return.
Central banks, such as the Federal Reserve (Fed) in the U.S., control the money supply through policies like quantitative easing (QE), interest rate adjustments, and open market operations.
How M2 Correlates With Crypto Markets
Crypto assets, particularly Bitcoin and Ethereum, have shown a strong correlation with M2 money supply expansion. The connection is based on monetary inflation and liquidity cycles:
1. Liquidity Drives Crypto Bull Runs
When the Fed increases M2 (via money printing or stimulus), more liquidity enters financial markets. Investors seek higher returns, often moving capital into risk-on assets like stocks and cryptocurrencies.
Example: 2020-2021
The Fed expanded M2 aggressively during the COVID-19 stimulus era.
Bitcoin surged from $3,800 (March 2020) to $69,000 (November 2021).
Ethereum followed, skyrocketing from $90 to over $4,800.
2. M2 Contraction Triggers Crypto Bear Markets
When the Fed tightens monetary policy (raising interest rates, reducing liquidity), crypto markets experience downturns due to capital outflows.
Example: 2022-2023
The Fed started quantitative tightening (QT) and rate hikes.
M2 stagnated and even declined for the first time in decades.
Bitcoin plunged from $69,000 to under $16,000.
Historically, Bitcoin's major crashes (e.g., 2018, 2022) align with periods of M2 contraction and monetary tightening.
Why the Current M2 Trend Is Bullish for Crypto
The tide has shifted back in favor of crypto. The M2 money supply has expanded again, indicating more liquidity could flow into financial assets.
1. The Fed Is Slowing Rate Hikes
Inflation is cooling, and the Fed is signaling potential rate cuts in late 2024.
Lower interest rates increase borrowing and liquidity, boosting risk assets.
2. Global Central Banks Are Reverting to Easing
China, Japan, and the European Central Bank (ECB) are signaling stimulus measures.
More liquidity globally strengthens crypto’s adoption as a hedge against currency devaluation.
3. Institutional Demand and Bitcoin ETFs
Bitcoin ETFs have attracted billions in inflows, further tying crypto to macroeconomic liquidity cycles.
If M2 expands, institutions may increase Bitcoin and Ethereum allocations.
4. De-dollarization and Store of Value Narrative
Countries like China, Russia, and the BRICS nations are reducing reliance on the U.S. dollar.
Many investors view Bitcoin as "digital gold", a hedge against fiat devaluation.
As of March 10, 2025, the financial landscape is witnessing notable shifts in both traditional and digital currencies. The M2 money supply has experienced significant growth, influencing various asset classes, including cryptocurrencies.
Current Trends in M2 Money Supply
In January 2025, the U.S. M2 money supply increased by 3.86% year-over-year, marking the largest gain in 30 months. This surge brought the total M2 to approximately $21.56 trillion, reflecting a consistent upward trend over the past year. Forecasts suggest this growth will continue, with projections estimating M2 reaching $21.73 trillion in February and $22.70 trillion by September 2025.
Correlation Between M2 Expansion and Cryptocurrency Markets
Historically, an expanding M2 money supply has been associated with increased liquidity in financial markets, often leading investors to seek alternative assets like cryptocurrencies. The recent growth in M2 aligns with bullish movements in the crypto space:
Bitcoin's Performance: Bitcoin has experienced significant volatility in recent months. After surpassing the $100,000 mark in late 2024, it reached a record high of $106,491, marking a gain of over 50% since November 2024. As of March 10, 2025, Bitcoin is trading around $78,328, reflecting a recent pullback but maintaining substantial year-over-year growth.
Ethereum's Performance: Ethereum has also seen notable movements, currently trading at approximately $1,864, with intraday fluctuations between $1,826 and $2,145.
Factors Favoring Cryptocurrency Amid M2 Growth
Several developments suggest a favorable environment for cryptocurrencies in the context of M2 expansion:
Institutional Adoption: The approval and launch of Bitcoin Exchange-Traded Funds (ETFs) have opened new avenues for institutional investors, increasing capital inflows into the crypto market.
Regulatory Support: The current U.S. administration has signaled a supportive stance toward digital assets. Proposals such as establishing a strategic Bitcoin reserve indicate potential mainstream acceptance and integration of cryptocurrencies into national financial strategies.
Global Economic Conditions: Continued monetary expansion and low-interest-rate environments make traditional savings less attractive, prompting investors to explore alternative stores of value, including cryptocurrencies.
Outlook
The interplay between the expanding M2 money supply and the cryptocurrency market suggests a potentially bullish outlook for digital assets. As liquidity increases, and with growing institutional and regulatory support, cryptocurrencies like Bitcoin and Ethereum may continue to attract investment, solidifying their positions in the global financial ecosystem.
Crypto thrives in periods of high liquidity and monetary expansion, making M2 one of the best macro indicators for predicting bull runs. With M2 stabilizing and signs of a return to monetary easing, conditions are increasingly bullish for digital assets.
ASs 2025 unfolds, keep an eye on M2 trends—because if history repeats itself, Bitcoin and Ethereum may be gearing up for another explosive cycle.
Note: The information provided is based on the current market conditions as of March 11, 2025, and is subject to change with market dynamics.
Opt-In for Free Crypto Trade Alerts (Beta)
Introducing the Crypto Alpha Ultimate Algorithm BETA—Now in Beta & Free for Early Subscribers!
Get real-time crypto trade alerts directly to your email & phone.
Why Join?
Powered by the Crypto Alpha Algorithm: Identifies optimal buy/sell signals based on real-time market conditions.
Institutional-Grade Data: Leveraging cutting-edge analytics for maximum accuracy.
Beta Launch = Free Access!: Get in early while we fine-tune the algorithm.
This is your chance to get real-time insights from a powerful crypto market algorithm at no cost.
👇 Opt-in now and start receiving trade alerts!
Comments