Real Vision CEO Raoul Pal believes conventional wisdom on when the current crypto cycle will end is missing the mark.
“Markets are all about psychology, and if everyone expects something to happen, it won’t happen. So everybody’s kind of got in their heads that the cycle ends in December because that’s what it did in ‘13 and that’s what it did in ‘17.
My guess is that we probably have a sell-off, and then it rips again because that is the path of most pain and markets tend to take the path of most pain.”
However, the imminent launch of an Ethereum ETF and ETH 2.0 could be catalysts for a massive rally that would extend the crypto cycle to June, according to Pal.
“The retail ETF is coming. It’ll come out in the next couple of months, so we’re going to broaden access and bring [in] institutions. Institutions tend to make asset allocation decisions by quarters, and my guess is [during] January to March quarter next year we’re going to see a huge inflow.
I think the other big driver of this market is going to be ETH 2.0. The reason being is everybody is staking their ETH. It’s creating this incredible supply and demand imbalance in ETH where there’s only about 11% of the total ETH supply available. Everything else is locked up for this staking…
All of that means that we’re likely to see an extended cycle, and I think it extends into between March and June, and that would be a new phase.”
Pal goes on to discuss the expanding nature of the crypto markets.
“Crypto is currently $2 trillion as of today. I think it’s pretty reasonable to expect it to go to $200 trillion. So that’s a 100x. None of us have seen anything like an entire asset, which is a rich and deep asset class with many things, going up a 100x.
That’s how I try to explain it to people. Don’t overthink it. Everybody can make money. It’s all about time horizon [and] understanding the volatility. Take the risk that you can afford to take.”
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