Money supply is at a record. The growth rate is not.

That single line captures the current monetary picture better than most lengthy commentaries. U.S. M2 continues to grind higher in absolute terms—still setting nominal highs—but the year-over-year pace remains modest. The latest August reading sits near 5.7 percent, well below the prior cycle's 13.5 percent peak and roughly in line with the longer-term average once the pandemic surge is stripped out. China M2 is running a bit faster at 7.5 percent, while euro-area M3 is slower at 3.5 percent. The fixed-exchange-rate comparison, which smooths out currency swings, lands near 4.5 percent. In other words, the world is adding money, just not at anything resembling the emergency rates of 2020–21.

This matters for several reasons. First, it undercuts the simple “money printer go brrr” narrative that still circulates in some corners. Absolute levels are high because the base is large; the incremental growth is not. Second, it helps explain why inflation has cooled without a collapse in activity. The sharp contraction in M2 growth that occurred in 2022–23 did most of the work; today’s modest expansion is consistent with a soft-landing path rather than a renewed inflation surge. Third, it leaves open the question of what happens if growth re-accelerates. Policymakers still have room to ease, but the starting point is no longer the zero-rate, rapid-expansion regime of the early pandemic.

For markets, the implication is straightforward: liquidity is adequate but not abundant. Equities and risk assets can still perform if earnings hold up, yet the powerful tailwind of double-digit money growth is absent. That puts more weight on other drivers—productivity, fiscal policy, and geopolitical shocks—than on monetary expansion alone.

Stablecoin Float Is Parked, Not Expanding

The stablecoin chart tells a parallel story on the crypto side. Total float is roughly $304 billion, up only about 1 percent over the past 90 days. USDT remains the dominant piece at approximately $184 billion and has been essentially flat. USDC sits near $73 billion after a modest decline, and the rest of the field makes up the balance. The headline is the lack of growth: capital is not flooding into stablecoins the way it did during prior risk-on stretches.

Parked stablecoins are dry powder that has not yet been deployed. In past cycles, rising stablecoin supply often preceded or accompanied broader crypto inflows. The current stall suggests that much of the existing float is being held rather than used to buy other assets. That can be constructive if it reflects deliberate positioning ahead of clearer signals; it can also signal caution if holders prefer the optionality of dollars over directional bets. Either reading fits the modest money-growth backdrop described above—liquidity exists, but the impulse to deploy it aggressively is muted.

ETF Flows Moved Bitcoin, Then Cooled

The third chart focuses on the late-September window when U.S. spot Bitcoin ETF flows briefly led price. A strong multi-day stretch of inflows, peaking with a roughly $1 billion session and a multi-billion-dollar week, coincided with Bitcoin’s move higher. The same-day correlation during that period was positive and visible on the chart. Once those flows slowed and then turned mixed-to-negative in early October, the price leadership faded. Recent sessions have included several outflow days, and Bitcoin has drifted lower from the late-September levels.

This sequence is useful precisely because it is limited. ETF flows can amplify moves when they are large and persistent; they are not a permanent bid. The September episode shows that institutional vehicles can still move the market in both directions once sentiment shifts. It also reinforces a broader point from the first two charts: the underlying liquidity environment is not generating automatic demand. When incremental money growth is modest, and stablecoin float is flat, sustained ETF inflows become a more important marginal source of buying. Their absence removes one support.

Putting the Three Charts Together

Viewed side by side, the charts describe a market that is no longer starved of liquidity but is also not awash in it. Money supply growth has normalized. Stablecoin balances are stable rather than expanding. ETF flows can still drive short-term price action in Bitcoin, yet they haven’t remained consistently positive. Together, these factors point to a range-bound or selective risk environment rather than a broad, liquidity-fueled melt-up.

None of this rules out further gains. Earnings growth, AI-related capital spending, or a geopolitical de-escalation that lowers energy prices could all support equities and crypto independently of money-supply trends. Conversely, an escalation that pushes oil sharply higher, or a renewed rise in bond yields that tightens financial conditions, would test the modest liquidity backdrop more severely. In that sense, the charts are descriptive rather than predictive: they show today's monetary and crypto-liquidity starting points.

For portfolio construction, the practical takeaway is to be restrained on pure liquidity bets. Positions that require accelerating money growth or rapid stablecoin expansion to work are less supported than they were in 2020–21. Positions that can perform with steady but unspectacular liquidity—quality equities, selective energy exposure if geopolitical risk rises, or Bitcoin held for longer-term reasons rather than flow-driven momentum—fit the data more cleanly. Record money supply levels remain a background fact; subdued growth rates are the more relevant signal for the months ahead.

I have been researching, analyzing, and sharing my views of the cryptocurrency market since Bitcoin was $100. Beyond crypto, I cover precious metals, mining stocks, energy, and the technology sector (AI, robotics, biotech, etc.), using the latest AI and Quant tools to find undervalued companies before the herd. In most cases, the small investment in our research pays for itself many times over. You can get started for just $395.

Cheers,

 Jason Hamlin, Founder, Nicoya Research