Actually, its not from neither ATP or water in the muscle cells,
but due to the fact on induction of myogenic cell differentiation
Here is a snippet of an article i wrote in my first year at Uni,
3.3 Physiologic effects of creatine on muscle growth
Muscle growth can be directly related to muscle hypertrophy. Increases in muscle size related to the extended ingestion of creatine have been examined in a number of other studies. These findings were examined by Willoughby and Rosene (2001) who described as follows:
"...it was observed that creatine supplementation resulted in significantly greater increases in type I and II myosin heavy-chain (MHC) mRNA abundance and protein content after 12 wk of resistance training, suggesting that an increase in MHC synthesis may account in part for the greater increases in muscle size with creatine supplementation.”
Further research was then undertaken to observe the effect of creatine on various biological systems within the body and its effects on the expression of various genes related to muscle growth. MRF4 is a protein involved in inducing myogenic cell differentiation and is expressed in developing muscle as it is directly related to muscle growth.
Hespel et al. (2001) showed that an increase in muscle hypertrophy due to the supplementation of creatine is directly related to the protein expression of MRF4. A further study conducted by Willoughby and Rosene (2003) reported that creatine supplementation increased the MRNA expression and consequently the content of MRF4. Collectively, these studies could explain the increases in muscle size and strength that results in the supplementation of creatine compounds.
Now lets discus,

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