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Bitcoin on the Brink of All-Time High as Macro Tailwinds Gather Strength
Record equity markets, surging money supply and fiscal risks set the stage for a historic July rally in the largest cryptocurrency.
Jul 4, 2025, 10:25 a.m.
What to know:
- The U.S. debt trajectory and relentless money printing raise the appeal of bitcoin as a scarce store of value, with Ray Dalio warning of “big, painful disruptions” if deficits remain unchecked.
- July’s seasonal trend favors bitcoin, which averages a 7% gain for the month, adding momentum as the price pushes past $100,000.
Bitcoin looks poised to climb to an all-time high this July, propelled by converging macroeconomic and market forces that are driving investors into riskier assets.
U.S. equity indexes are already setting records, with the S&P 500, Nasdaq Composite and Dow Jones Industrial Average all sitting at highs, reflecting widespread investor confidence. As traditional markets soar, capital often spills into alternative assets, and BTC is a prime beneficiary. At around $109,000, the largest cryptocurrency is trading less than 3% below the peak it set in May.
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One factor is the U.S. M2 money supply, which has climbed to a record $21.9 trillion and has touched highs each month over the past year. This surge in liquidity means potentially more money flowing into financial assets and a hunt for investments that can preserve purchasing power as government debt balloons.
According to Ray Dalio, the billionaire founder of hedge fund Bridgewater Associates, President Donald Trump's newly passed "Big Beautiful Bill" locks in roughly $7 trillion in annual spending against only $5 trillion in revenue. That will push debt levels from 100% of GDP toward 130% over the next decade.
“Unless this path is soon rectified to bring the budget deficit from roughly 7% of GDP to about 3% by making adjustments to spending, taxes, and interest rates, big, painful disruptions will likely occur,” he wrote in a post on X.
Historically, July has been a strong month for bitcoin, averaging gains around 7%, adding a seasonal tailwind. All signs point to the digital asset breaking new records in the coming months.
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Coinbase Sees Crypto Recovery Ahead as Liquidity Improves and Fed Rate Cut Odds Climb
The crypto exchange also took note of a so-called AI bubble that continues to go strong and a weaker U.S. dollar.
What to know:
- Coinbase Institutional is seeing a potential December recovery in crypto, citing improving liquidity and a shift in macroeconomic conditions that could favor risk assets like bitcoin.
- The firm's optimism is driven by rising odds of Federal Reserve rate cuts, with markets pricing in a 93% chance easing next week, and improving liquidity conditions.
- Several recent institutional developments, including Vanguard's crypto ETF policy reversal and Bank of America's greenlighting of crypto allocations, have contributed to bitcoin's rebound from recent lows.
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