Real Vision CEO Raoul Pal thinks Bitcoin (BTC) and other digital assets are holding up well despite facing a barrage of recent macroeconomic and geopolitical turbulence.
In a new interview, the former Goldman Sachs executive says his short-term prediction for the crypto markets would be for prices to dip lower.
However, the macro guru says that he’s been pleasantly surprised by the crypto market’s resiliency in the face of inflation and the ongoing war between Russia and Ukraine.
“An answer to [where crypto’s going] right now, I don’t know. The chart looks like it wants to go lower again and have another spike low. That’s been my view for a while.
However, the crypto markets have not made a new low versus last year. We’ve thrown in 8% inflation, the market pricing in 1.8% rate hikes, and a war, and you haven’t made a new low.
That’s telling us something.”
Pal says that while crypto prices are still susceptible to a significant downswing, he thinks the lows are in after seeing a 50% correction since last November.
“I’ve got a lot of technical divergences, a lot of the on-chain activity is very interesting.
I’m still thinking that we’ve probably captured the downside in this 50% down bracket that we’ve been in with Bitcoin and Ethereum.”
Looking specifically at leading smart contract platform Ethereum (ETH), Pal says that ETH’s price is currently slightly higher relative to its number of users due to the protocol routinely burning tokens after its mainnet upgrade last year.
“The ETH model is slightly deviating from fair value. I think that is because there is a difference in ETH versus all the other networks…
If you look at the ETH price in blue, it’s higher than the network and I think that has to do with the burning of tokens.
If I were to model this better, in ones where there is a token-burning model, you should see a slight outperformance versus this model, because obviously, you’re reducing supply all the time.”
Ethereum is up 1.29% on the day at time of writing and is priced at $2,622 while top crypto asset Bitcoin is down less than a percent and is trading for $39,384.
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