Bitcoin is poised for a strong rally this July, fueled by rising equity markets, expanding money supply, and mounting fiscal challenges.
Trading around $108,140, Bitcoin nears its all-time high, driven by macroeconomic conditions that encourage investment in riskier assets.
U.S. stock indices such as the S&P 500, Nasdaq Composite, and Dow Jones are all approaching record levels, reflecting investor optimism that often leads to increased demand for alternative assets like Bitcoin. The cryptocurrency is currently trading just under 3% below its peak from May near $109,000.
A key contributor to this trend is the U.S. M2 money supply, which has reached a historic $21.9 trillion, hitting monthly records over the past year. This surge in liquidity is pushing investors toward stores of value amid growing concerns over government debt.
Ray Dalio, founder of Bridgewater Associates, pointed out fiscal risks connected to the recently passed “Big Beautiful Bill,” which locks in $7 trillion in annual spending against $5 trillion in revenue, forecasting debt to rise from 100% to 130% of GDP in the next ten years.
Dalio warned on X that the U.S. must reduce budget deficits from about 7% to 3% of GDP through fiscal measures to avoid significant economic problems.
July has historically been a positive month for Bitcoin, averaging gains of around 7%, indicating the cryptocurrency could be set for new highs soon.
