Bitcoin’s 15% correction during the third week of December marked its largest weekly price drop since August. Experts attribute the decline to the impact of global macroeconomic factors, warning that ...

Bitcoin’s 15% correction during the third week of December marked its largest weekly price drop since August. Experts attribute the decline to the impact of global macroeconomic factors, warning that Bitcoin could see further downside if these pressures intensify.However, Bitcoin also has internal factors to counterbalance the negative impact of the macro.<h2>Global Liquidity Plunges Over the Past Two Months</h2>According to The Kobeissi Letter, Bitcoin’s price has historically shown a 10-week lagged correlation with Global Money Supply (Global M2). Over the past two months, Global M2 has fallen by $4.1 trillion, signaling potential further declines in Bitcoin prices if the trend continues.Global M2 is a key economic metric that measures the total supply of money in the global economy, including cash, demand deposits (M1), term deposits, and other liquid assets. Fluctuations in Global M2 often impact both stock and cryptocurrency markets.<blockquote>“As global money supply hit a new record of $108.5 trillion in October, Bitcoin prices reached an all-time high of $108,000. Over the last 2 months, however, money supply has dropped by $4.1 trillion, to $104.4 trillion, the lowest since August. If the relationship still holds, this suggests that Bitcoin prices could fall as much as $20,000 over the next few weeks.” – The Kobeissi Letter <a href="https://x.com/KobeissiLetter/status/1870541179433160848" rel="nofollow">predicted</a>.</blockquote><img alt="Bitcoin Price vs. Global Money Supply. Source: The Kobeissi Letter" src="https://static.fwimg.io/img/feed/590c2b75b131dc529f34eadd6ad89399.jpg">Bitcoin Price vs. Global Money Supply. Source: <a href="https://x.com/KobeissiLetter/status/1870541179433160848" rel="nofollow">The Kobeissi Letter</a>A month ago, Joe Consorti, Head of Growth at Bitcoin custody firm Theya, <a href="https://beincrypto.com/bitcoin-faces-correction-amid-m2-decline/" rel="nofollow">warned of a potential 20%-25% Bitcoin correction</a> based on similar indicators. That forecast appears to be materializing.André Dragosch, Head of Research at Bitwise, shares a similar outlook. He anticipates Bitcoin will remain under <a href="https://beincrypto.com/crypto-market-liquidation-inflation-concerns/" rel="nofollow">pressure due to tightening liquidity</a> in the United States. However, he highlights an <a href="https://beincrypto.com/learn/bitcoin-halving-prediction/" rel="nofollow">internal Bitcoin factor</a> that could counterbalance this liquidity squeeze: Bitcoin’s growing illiquid supply.<img alt="Bitcoin Price vs. Illiquid Supply. Source: André Dragosch" src="https://static.fwimg.io/img/feed/9a4d82edfadf3c5ef5530942f9f7fbc0.jpg">Bitcoin Price vs. Illiquid Supply. Source: <a href="https://x.com/Andre_Dragosch/status/1869563228243558823" rel="nofollow">André Dragosch</a>A higher illiquid supply indicates increased scarcity of Bitcoin, potentially supporting its price under supply-demand dynamics.<blockquote>“Bitcoin is currently balancing the prospects of a) increasing macro headwinds stemming from the decline in US and global liquidity and b) ongoing on-chain tailwinds stemming from the strong BTC supply deficit. Eventually bullish on-chain factors will likely trump bearish macro factors but this will likely create some volatility in early 2025 (and possibly some attractive buying opportunities).” – André Dragosch <a href="https://x.com/Andre_Dragosch/status/1869563228243558823" rel="nofollow">commented</a>.</blockquote>At press time, Bitcoin is trading around $94,000, with BeInCrypto data showing it <a href="https://beincrypto.com/bitcoins-exchanges-outflow-increase/" rel="nofollow">has dropped nearly 6% over the weekend</a>.

Experts Predict Bitcoin Could Drop $20,000 Amid Global Money Supply Decline

Bitcoin (BTC) has experienced a 5% dip over the past week. As of this writing, the leading coin trades at $96,905, below the key $100,000 price level.
Interestingly, the recent decline has not sparked...

Bitcoin’s (BTC) $2.25 Billion Exchange Outflow May Fuel Its Return to an All-Time High

This week, BTC opened at $104,445.15 and closed at $95,087.75. On December 17, it reached a new all-time high of $10,838.88. Overall, BTC recorded a 8.96% decline this week, with a high volatility of 15.58%. Trading volume slightly increased but remained at a similar level as the previous two weeks. This is the first weekly pullback since BTC surged 38% in the first half of November, with the core factor still being profit-taking by investors.

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Standing above $100,000, BTC enters a "zero risk" slow upward phase (12.09~12.15)

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