Real Vision founder and former GLG hedge fund manager Raoul Pal is telling crypto investors the recent collapse in sentiment is not the end of the cycle. In a new interview clipped and analysed by Crypto Nutshell, Pal argues the data that actually drives his thesis, global liquidity and dollar direction, has already turned.
The backdrop is extreme. The CNN Fear and Greed Index has just posted its longest ever stretch below 10, a reading that flags entrenched panic rather than a single flush. Ethereum is well off its cycle highs, altcoins are deeper underwater, and online conversations have pivoted from price targets to whether the cycle is simply finished.
Pal is not persuaded. "I don't think it's the end of the cycle. I think it's a midcycle correction," he said. "I know there's a raging debate about that. But when I look at the things that matter to me, I see global M2 all-time highs, global liquidity had a pullback because of the dollar. Now the dollar is weakening. It's looking like it's going to go back to all-time highs."
His framework treats global M2, the broad money supply measure across major economies, as the single most reliable leading indicator for risk assets. When the dollar strengthens, global M2 compresses in real terms because most world trade and debt is denominated in dollars. A weakening dollar does the opposite, and Pal sees the dollar already turning lower.
"Our financial conditions index corrected somewhat, but that's looking okay as well as the dollar and rates back off. Um we're seeing the ISM going up. We're seeing US liquidity conditions rising. It's like everything is green here in front of us," he said. "Um and that's a decent backdrop for the market considering the market's sentiment is literally some of the worst I've ever seen. We've had the longest period in history where the fear and greed index has been below 10."
Pal sees geopolitics working in favour of the thesis rather than against it. His view is that the Iran conflict is converging toward a negotiated exit because every major regional actor has an interest in a deal. "It's in everybody's interest to reach an agreement where Iran has no nukes they stop funding Hezbollah and stuff like that in exchange they get the removal of sanctions over time which means their economy can boom," he said. "It means that oil prices come down which is a win for everybody because everybody's using as much energy as possible to generate as much intelligence as possible right now in the AI wars."
On crypto specifically, Pal argues institutional adoption has moved from speculation to foregone conclusion. "Every bank wants to build on the rails. Every payments company wants to build on the rails. Every asset manager wants to tokenize their funds. We're hearing that the NASDAQ wants to move to blockchain rails. We're hearing that the DTCC is moving to blockchain rails."
The most provocative part of his case is that blockchain's addressable market is no longer bounded by the human population. "It's almost like blockchain was not built for us but it was built for the agents," he said. With AI agents now holding wallets and executing transactions autonomously, he argues the user base is effectively uncapped.
Pal acknowledged Bitcoin dominance has been quietly trending lower through successive cycles and offered a structural reason. "Bitcoin's total addressable market is basically global savings. It's a store of value. Smart contracts are basically all economic activity on the internet or in the agent world. So over time they will end up as a basket of of um layer ones particularly to be more valuable than Bitcoin."
On the US political layer, Pal said the industry's priority is the Clarity Act. "The only thing that matters is passing the Clarity Act and Donald Trump was involved. Scott Besson's been involved. I mean, everybody is pushing for that to get signed. Then it's in the law and it doesn't matter."