Bitcoin punched through a fresh record above $122,000 on the morning of 14 July, extending its month-long rally to more than 16 percent. Against that backdrop, Charles Edwards\u2014the founder and chief executive of digital-asset hedge fund Capriole Investments\u2014argues that the market is only \u201cin the early stages\u201d of a much broader liquidity-driven boom that could dominate the rest of 2025 and beyond.<\/p>\n
In the latest Capriole newsletter<\/a>, Edwards contends that \u201cmoney and liquidity provided the backdrop for capital flows, and Bitcoin Treasury Companies are the funnel.\u201d He dismisses the idea that the past fortnight\u2019s $20,000 advance was a technical accident, pointing instead to deep macro currents that have been building for months.<\/p>\n \u201cThe biggest Bitcoin rallies occur when the market is net short the USD,\u201d he writes, pointing to Capriole\u2019s proprietary \u201cUSD Positioning\u201d gauge, which aggregates futures data across major currencies. The metric has been \u201cdeeply negative\u201d since early summer, signalling that global investors are decisively betting against the dollar and in favour of hard assets.<\/p>\n Another pillar is credit. BBB-rated corporate-bond spreads have been grinding tighter since the spring, a classic risk-on signal in traditional markets that, since 2020, has mapped almost tick-for-tick onto major Bitcoin up-moves. \u201cMore evidence,\u201d Edwards notes, \u201cthat Bitcoin is a tradfi asset.\u201d<\/p>\n Perhaps the strongest tail-wind, however, is raw money growth. Global M3 has been expanding at an annualised nine percent clip\u2014an historically extreme rate that Capriole says last coincided with average 12-month Bitcoin returns of roughly 460 percent. Edwards cautions that, as a multi-trillion-dollar asset today, Bitcoin is unlikely to repeat that magnitude, \u201cbut it wouldn\u2019t be surprising to see something very substantial from here.\u201d<\/p>\n Capriole\u2019s framework also draws on an historical lead-lag relationship<\/a> between gold and Bitcoin. When bullion enters a meaningful breakout, Bitcoin has tended to follow three to four months later. Gold\u2019s early-2025 surge\u2014and its outperformance versus global equities\u2014therefore offered \u201cstrong support for the current market\u2019s diminishing demand for fiat money and favour of hard money,\u201d Edwards argues. Since Capriole flagged gold\u2019s move in April, Bitcoin has risen 28 percent.<\/p>\n Equities, too, are offering green lights. The New York Stock Exchange advance\u2013decline line broke to new highs last week, while Capriole\u2019s \u201cEquity Premium\u201d indicator reset to zero in late May\u2014both historically consistent with multi-month stretches of expanding risk appetite.<\/p>\n All of those data points feed into the firm\u2019s flagship Bitcoin Macro Index, a composite of dozens of public and proprietary variables that Capriole uses to shape trading exposures in its fund. The index \u201cis still in strong positive growth territory,\u201d Edwards reports, even after the coin\u2019s latest vertical move. That suggests the underlying drivers\u2014liquidity, risk sentiment and on-chain activity\u2014\u201cremain intact.\u201d<\/p>\nThe Bitcoin Treasury-Company Flywheel<\/h2>\n