M2-Bitcoin Elasticity: the answer is....2.65x One of the key raison d'etres for hodling bitcoin is it's close, positive correlation with global liquidity. This can be as high as 95% over the long-term. So it pays to keep an eye on the relationship. With that in mind, I dug around to find out if there was any research that quantified the likely relationship between bitcoin and M2. I came across this paper in that well known publication, The Journal of Economics and Social Dynamics: "The M2-Bitcoin Elasticity: A Cointegration Analysis (2015–2025)." Although focused on US M2 only, it concluded that there was "..a long run elasticity of 2.65, suggesting a 1% increase in the M2 money supply is associated with a 2.65% increase in the price of Bitcoin. Furthermore, it suggests that there is a where there is any significant deviation from the long-run equilibrium it will be corrected at a monthly rate of approximately 12 percent. Based on this rate, it would take around 8–9 months for the system to revert to the mean after a shock. Link: https://wmjournals.com/img/JPMIDT/WMJ-JESD-104-The-M2-Bitcoin-Elasticity-A-Cointegration-Analysis-20152025.pdf #asknostr