Bitcoin (BTC) is currently trading “massively below” its global liquidity fair value, reaching a level of historical mispricing that some analysts believe will trigger an aggressive price rebound. According to data shared by crypto trader and YouTuber RobynHD on Tuesday, May 27, 2026, the digital asset’s Z-score relative to the global M2 money supply fair value is currently near -2. This specific mathematical divergence has never occurred historically and indicates a period of maximum mispricing for the cryptocurrency.
The gap between Bitcoin’s actual price and its model-driven “fair value” has widened significantly throughout early 2026. On March 19, 2026, the M2 fair value model placed Bitcoin near $136,000, while the actual market price sat at roughly $74,000—a deficit of approximately 46%. This decoupling is underscored by the fact that in the 12 months leading up to March 19, 2026, global M2 growth rose by more than 12% while Bitcoin’s price declined by roughly 12%.
Market sentiment remains fragile following recent technical breakdowns. On May 25, 2026, Bitcoin lost a critical support zone near $75,000–$76,000, leading analysts like Michaël van de Poppe to suggest the asset may break into the $60,000 range. This price action follows a spike in market volatility that has wiped out hundreds of millions in leveraged positions, clouding the immediate outlook despite the long-term liquidity signals.
Bitcoin Z-score reaches unprecedented negative territory
The Z-score, a metric used to measure how far an asset’s price deviates from its historical relationship with liquidity, has seen a dramatic shift. In January 2025, Bitcoin’s Z-score was a positive +1.48, suggesting it was trading above its liquidity-based value. By February 2026, that figure had plummeted to -1.31. As of May 27, 2026, the Z-score’s drop to near -2 represents a complete reversal in valuation metrics.
RobynHD highlighted that if the historical relationship between Bitcoin and global liquidity remains intact, the current market price is “completely mispriced.” Other assets have tracked the rising liquidity more effectively. For example, the price of gold, which was up nearly 89% since early 2025 as of March 19, 2026, pushed above $5,000 per ounce. This outperformance is reflected in gold’s Z-score, which rose from 1.38 in January 2025 to 2.82 in February 2026.
The disconnect is also visible in comparison to traditional equities. While global equities gained over 21% from early 2025 to March 19, 2026, Bitcoin declined roughly 35% in that same timeframe. This divergence suggests Bitcoin is currently failing to act as its tradition “liquidity sponge” for M2 expansion, which reached $22.667 trillion in the United States by February 2026.
Heavy liquidations follow loss of seventy-five thousand dollar support
The technical weakness reached a boiling point on May 23, 2026, when Bitcoin fell to a low of $74,255. As the price breached $75,000, over $100 million in long positions were liquidated within just one hour. The broader market witnessed a total of $941 million in liquidations over a 24-hour period ending that day, affecting more than 161,200 individual traders as market signals cooled rapidly.
Bitcoin liquidations accounted for approximately $378 million of that total, while Ethereum (ETH) saw $255 million in forced exits. One notable liquidation on the Bitget exchange reached $32.4 million. These liquidations occurred alongside heavy institutional movement, with US spot Bitcoin ETFs recording outflows of more than $2 billion in the two weeks ending May 23, 2026.
Spot demand is also showing signs of a significant slowdown. Julio Moreno, Head of Research at CryptoQuant, stated that Bitcoin spot demand is contracting at its fastest pace since January 10. This lack of buying pressure at the retail and institutional levels has made it difficult for Bitcoin to hold its ground, even as the global M2 money supply continues to grow.
Analysts weigh risks of a deeper correction to sixty thousand dollars
Leading market voices are now divided on whether the “fair value” rebound will happen before or after another leg down. Benjamin Cowen has argued that the most likely outcome involves a return to test prior lows. Cowen suggested there is a “good chance” Bitcoin could slip below $60,000. This bearish sentiment stems from the asset losing the $75,000 mark, which Michaël van de Poppe noted has “flipped the thesis” for many traders.
The Bitcoin to US M2 money supply ratio was measured at 3.26 on May 21, 2026. Strikingly, the correlation between the two was -0.83 for the 12 months leading up to that date, a sharp departure from the strong positive correlation typically expected. For the market to normalize, Bitcoin would eventually need to bridge the “fair value” gap, yet the current timing remains uncertain given the accumulation phase currently being observed in other digital assets.
While the M2 models indicate Bitcoin is fundamentally undervalued, the immediate path is burdened by contracting demand and high levels of leverage being flushed from the system. Whether the Z-score of -2 serves as a definitive floor or a precursor to further pain depends on when spot demand returns to balance the current institutional outflows.