For years, Bitcoin and crypto moved in near lockstep with global liquidity. When central banks expanded the money supply — measured by global M2 — risk assets like Bitcoin soared. The relationship was one of the most reliable macro signals in crypto.

That relationship has broken in 2026.

Global M2 has continued climbing, recently surpassing $100 trillion and still growing at a solid pace. And it isn’t just in the United States. All governments seem addicted to printing money to solve current problems and create prosperity, even if it means future inflation runs hot and leaves a painful reckoning for the next generation.

Despite all of the new fiat money sloshing around, Bitcoin has fallen sharply from its October 2025 peak above $126,000 and is now trading near $64,000 — a roughly 50% drawdown. The usual liquidity tailwind isn’t lifting crypto this time.

The chart below shows global liquidity (M2) in orange, and the Bitcoin price is green.

The divergence is glaring, but it is worth noting that a similar one happened in the first half of 2024 (beginning of chart) and was followed by a violent upward move in Bitcoin that closed the gap.

Will this repeat?

The correlation is more reliable when you look at year-over-year percentage change in global M2 liquidity, rather than the absolute number that has been climbing steadily. The blue line in the chart below shows that global liquidity growth slowed significantly in Q2 of 2026, before starting to bounce back in recent weeks.

This may help explain the divergence between global liquidity and the Bitcoin price. But we still have to ask, where is all the new money going?

The answer increasingly looks like artificial intelligence.

The scale of AI investment is staggering. The four major hyperscalers — Amazon, Google, Microsoft, and Meta — are on track to spend roughly $700–$760 billion in capital expenditures this year alone, with a heavy focus on data centers, GPUs, and AI infrastructure. Broader estimates put total global AI-related investment near or above $1 trillion in 2026! That’s real money being deployed into tangible projects with contracts, revenue projections, and corporate balance sheets behind them.

Compare that to crypto. While Bitcoin ETFs and corporate treasuries like MicroStrategy and Metaplanet keep buying, overall flows into crypto have slowed dramatically. Spot Bitcoin ETFs have seen significant outflows in recent months, and retail and institutional capital appears to be rotating elsewhere.

This isn’t just a narrative — it’s capital allocation in action. Investors and corporations have a choice: put money into a scarce digital asset that relies on future adoption and sentiment, or fund the buildout of what many see as the most transformative technology of our generation. Right now, AI is winning that competition for marginal dollars.

Michael Saylor and others have pointed out that this massive AI spending represents one of the biggest near-term headwinds for Bitcoin. The liquidity is there, but it’s being absorbed by power-hungry data centers, specialized chips, and the infrastructure arms race between tech giants.

This dynamic helps explain why stocks — particularly AI-related names — have hit record highs while Bitcoin has lagged. New money isn’t flowing evenly across risk assets. It’s being channeled into the theme with the strongest momentum, clearest use case, and most aggressive corporate spending.

Not at all. Liquidity cycles are powerful, and Bitcoin’s fixed supply of 21 million coins remains a compelling long-term argument as M2 keeps expanding. Many analysts still expect Bitcoin to eventually catch up if liquidity growth accelerates or if AI spending starts to deliver clear returns that free up capital.

But for now, the market is sending a clear message: in the competition for fresh capital, AI is stealing crypto’s thunder.

The divergence between global liquidity and Bitcoin’s price may not last forever — these relationships tend to reassert themselves over time. The money printing is unlikely to stop. Global M2 continues hitting all-time highs (now in the $100–121 trillion range), and the fractional-reserve system must keep expanding to service debt and maintain the illusion of prosperity. Bitcoin’s supply schedule does not change.

This gap has never stayed open for long. Once the initial frenzy of AI data-center buildouts begins to mature — and many signs already point that way — I expect Bitcoin to close the gap, potentially in one of the fastest catch-up moves in its history. Historical relationships to Global M2 point toward the $150–180k zone. Combined with the typical post-halving bottoming window in Q3 or Q4 of this year, the current ~50% discount looks like an attractive accumulation opportunity for patient capital. Liquidity sets the conditions. It doesn’t set the appointment.

During this crypto lull, we have been aggressively building positions in AI infrastructure and “picks-and-shovels” companies. We have also started adding exposure to our crypto portfolio with altcoins and crypto equities that we believe can outperform during the next bull cycle.

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Cheers,

 Jason Hamlin, Founder, Nicoya Research