Raoul Pal, co-founder and CEO of Real Vision Group, has provided a bold macroeconomic perspective on the cryptocurrency market.
Pal’s insights come amidst the ongoing market selloff, which has sparked bearish concerns in some quarters.
Market Correction: A Repeat of 2017?
In a series of X posts, Pal noted that the current market downturn is a normal correction. He assured investors not to regard it as a long-term bearish shift, as it will soon blow over.
Notably, the crypto expert attributes the ongoing crypto dip to tightened liquidity. According to Pal, this was caused by the stronger U.S. dollar and higher interest rates recorded in Q4 2024.
He drew a correlation to past market cycles, specifically in 2017. Pal maintained that the current market cycle mirrors that era when President Donald Trump’s policies also led to a stronger dollar and higher interest rates.
It remains to be seen if Bitcoin and other crypto assets will continue to soar under President Trump’s administration.
Pal insists that in 2017, a similar market correction occurred before crypto assets witnessed a rebound.
He noted that, from charts and on-chain data, this phase of market correction is almost over.
The crypto expert said that with financial conditions easing rapidly and the M2 money supply rising again, the worst is almost over in the market correction phase.
Raoul Pal Highlights Patience as Crypto Cycle Develops
Pal is primarily suggesting that there is a shift in favor of risky assets like crypto. This signals that a market recovery could occur very soon.
Relying on a statistical mode, the log regression channel, used to track Bitcoin’s long-term price trajectory, Pal expresses optimism about a recovery.
He insists that crypto has historically followed the “red line” or mean or exceeded it by one or two standard deviations.
Pal anticipates a rise and an overperformance of some crypto assets. He says the level “remains to be seen as the cycle develops.”
Pal’s additional source of confidence is the Institute for Supply Management (ISM) index. The ISM measures business activity, and Pal sees a correlation between it and crypto.
Given that the ISM has been predicted to rise through 2025, Pal is optimistic that crypto assets will follow suit. This mightl become evident as economic activities pick up.
He, therefore, advises investors to avoid panic-selling and overreacting to the current downturn in the market.
“Patience and less drama please!” the CEO of Real Vision Group cautions.
Bitcoin ETFs and Institutional Appetite
Meanwhile, market watchers opine that driven by massive liquidity, Bitcoin ETFs could significantly help reset the market.
Notably, Bitcoin ETF attracts institutional funds, and if these institutional players actively purchase the asset, it could boost market confidence.
That would catalyze and speed up recovery as the broader financial conditions improve.
However, this does not mean that the ETF activity would upturn the crypto cycle that is undergoing correction. Instead, it might support a quicker recovery. Hence, Pal called for investors’ patience.
In the ETF market, Farside Investors data show that institutional interest has continued to wane. After registering a $22.1 million inflow on March 5, the market has closed in red for two consecutive days.
On March 6th and 7th, Bitcoin ETF suffered outflows of $134.3 million and $409.3 million, respectively. This was aftera massive $2.8 billion outflow the previous week.
Analysts say if any reset is to happen, institutional players must rediscover their appetite for Bitcoin exposure. According to data, Bitcoin price has plunged to $77,875 as of this writing, a 5.46% decline in the last 24 hours.
