Global liquidity climbed to an unprecedented $144 trillion in December 2025, yet the response from major hard assets has not been uniform.

While gold has largely tracked the expansion in money supply, Bitcoin — often branded as “digital gold” — has posted far more erratic price action.

Global Money Supply Hits $144 Trillion

Data highlighted by The Kobeissi Letter shows that broad global money supply reached a record $144 trillion at the end of 2025.

Key Liquidity Metrics

  • Total global money supply: $144 trillion
  • Year-on-year increase: $13.6 trillion
  • Annual growth rate: 10.4%
  • Expansion since 2020: +$44 trillion (+44%)

December marked the third straight month of accelerating growth. The most aggressive surge in recent history occurred in February 2021, when money supply growth peaked at 18.7% during pandemic-era stimulus.

Outside periods of crisis, global money creation has rarely expanded at this pace.

Why Gold Is Responding as Expected

Historically, rising liquidity supports hard assets. More money circulating in the financial system often translates into stronger demand for stores of value.

Gold has followed that textbook pattern.

According to Jurrien Timmer, Director of Global Macro at Fidelity Investments, gold’s recent performance fits a classic bull-market structure.

Despite experiencing a sharp 21% drawdown earlier this month, the metal quickly regained footing. Short-lived pullbacks have been met with renewed buying pressure — a hallmark of sustained upward momentum.

Timmer describes gold as the “ultimate hard money” asset, one that has moved largely in lockstep with global liquidity growth.

Bitcoin’s Dual Identity Creates Friction

Bitcoin, however, tells a different story.

Although frequently compared to gold, Bitcoin operates with what Timmer calls a “dual identity”:

  • A potential hard, non-sovereign currency
  • A high-beta speculative technology asset

That second characteristic becomes decisive when market sentiment shifts.

Liquidity vs. Speculation

Timmer’s analysis suggests that when speculation — particularly in growth-oriented sectors such as software and SaaS — turns negative, it can outweigh the positive effect of expanding liquidity.

In previous cycles, Bitcoin thrived when two forces aligned:

  • Expanding global money supply
  • Strong speculative appetite

When both factors pointed upward, the result was explosive bull markets. But the reverse also holds true.

At present, liquidity is abundant, yet speculative momentum has cooled. Under those conditions, Bitcoin has struggled to mirror gold’s resilience.

A Market Split Between Hard Money and Risk Assets

The divergence underscores a broader market dynamic.

Gold’s singular identity as a defensive, inflation-sensitive asset allows it to benefit directly from liquidity growth. Bitcoin, by contrast, remains partially tethered to risk sentiment.

As February 2026 draws to a close, the crypto market faces a paradox: ample global liquidity but weak speculative conviction.

Whether Bitcoin realigns with the expanding money supply may depend less on central bank balance sheets and more on the return of risk appetite to digital asset markets.

Summary

Global money supply reached a record $144 trillion in December 2025, rising 10.4% year-on-year. Gold has tracked this liquidity surge closely, reinforcing its role as a hard-money asset. Bitcoin, however, has delivered uneven performance due to its dual nature as both store of value and speculative asset. Until speculative demand returns, rising liquidity alone may not be enough to propel BTC higher.