The global landscape of the monetary supply: Implications for the economy and cryptocurrencies

The total amount of money in circulation worldwide is a fascinating topic that has significant implications for the global economy and the crypto market. A detailed analysis of the data reveals interesting patterns about the distribution of monetary wealth among major economies.

Breakdown of the global monetary supply

The global money supply can be categorized as follows:

1. Cash (M0): Approximately 9 trillion dollars

   • This category includes physically printed bills and coins
   • Represents the most liquid monetary base

2. Money in bank accounts:

   • Money and deposits (M1): Around 100 trillion dollars
   • Large deposits and funds (M2): Approximately 150 trillion dollars

3. Total financial assets: More than 1 quintillion dollars

   • Includes stocks, bonds, and derivatives
   • Note: This figure represents market valuations, not real money in circulation.

Geographic distribution of the monetary supply

The analysis of the global distribution of money reveals a significant concentration in some key economies:

1. United States: Approximately 62 trillion dollars

   • Represents almost 41% of the global money supply
   • Reflects the status of the dollar as a global reserve coin

2. China: About 16 trillion dollars

   • Approximately 10.7% of the global total
   • Indicates the growing economic power of China on the world stage

3. Japan: Around 6.5 trillion dollars

   • It constitutes 4.3% of the global money supply
   • Highlights the ongoing importance of Japan in the global economy

This asymmetric distribution of the monetary supply has significant implications for the global economic balance and potentially for the crypto market.

Implications for the crypto market

The magnitude of the global money supply and its concentration in certain economies raises interesting questions for the crypto market ecosystem:

1. Growth potential: With a global money supply of approximately 150 trillion dollars, there is ample room for the expansion of the crypto market.

2. Diversification of reserves: The concentration of the money supply in few economies could drive the adoption of cryptocurrencies as a form of asset diversification.

3. Liquidity and volatility: The large amount of money in circulation could provide the necessary liquidity to stabilize the crypto market as it matures.

The analysis of the global monetary supply provides valuable context for understanding the potential and challenges of the crypto market. As the crypto ecosystem continues to evolve, its interaction with the traditional financial system will remain a major area of interest for both investors and analysts.