Raoul Pal Predicts Crypto Bull Run to Extend to 2026, Fueled by Global Liquidity Wave
Real Vision co-founder Raoul Pal, in collaboration with Global Macro Investor (GMI) head of macro research Julian Bittel, presents a compelling case that the current crypto market cycle is far from its peak. Instead, they argue that a powerful, liquidity-driven expansion is underway, poised to propel the crypto bull run well into 2026. This optimistic outlook is anchored in a macro framework connecting global government debt dynamics to an inescapable surge in liquidity.
The Unseen Engine: Liquidity as Crypto's Master Switch
Pal and Bitttel's "Everything Code" framework posits that while traditional economic indicators like declining working-age populations and subdued productivity growth create a structural gap, increasing public debt necessitates a continuous injection of liquidity from governments and central banks. Pal emphasizes that global governments and central banks are forced to increase liquidity by approximately 8% annually just to manage this escalating debt. This systemic debasement of fiat currency demands that investments yield at least an 11% return just to maintain purchasing power. In this environment, crypto and technology assets emerge as the only classes structurally capable of outpacing what Pal terms the "hidden debasement of fiat." The analysis further highlights the sequence of market indicators, where financial conditions lead the ISM manufacturing index by roughly nine months, and total liquidity leads the ISM by about three months. The ISM, in turn, sets the tone for earnings, cyclicals, and crypto beta movements within six months. This intricate dance reveals crypto not as an isolated outlier, but as a high-beta macro asset deeply integrated into the broader economic cycle, with Bitcoin acting as a leading indicator similar to the ISM for smaller-cap equities and emerging markets.
Navigating the Cycle: From Bitcoin to Altcoins and Beyond
The duo notes that the recent market "sideways chop" can be attributed to a significant, exogenous liquidity drain caused by the Treasury General Account (TGA) rebuilding since mid-July. However, this drain is now nearing its inflection point, with DeMark timing signals indicating a reversal in TGA's net liquidity contribution. This suggests a re-acceleration of liquidity into year-end, which, coupled with a lengthening refinancing cycle, sets the stage for the current bull run to extend robustly into 2026. Unlike the truncated 2020-2021 cycle, the current environment has the potential for sustained growth, driven by a crucial period over the next 12 months characterized by a $9 trillion debt rollover and subsequent money printing. From a portfolio perspective, Pal advocates for "hyper-concentration" in proven, large-cap crypto networks. He argues that traditional diversification strategies are dead, as most conventional assets underperform the combined debasement-plus-inflation hurdle. Crypto, particularly Bitcoin, is projected to dwarf all other asset classes in returns. The digital asset market, currently at $3.67 trillion, is forecasted to reach $100 trillion by the early 2030s if it continues its "fair value" adoption trajectory, with Bitcoin solidifying its role as the "digital gold" within this burgeoning ecosystem. Pal advises investors to maintain exposure to these foundational crypto networks, avoid leverage, and align their investment horizons with the macro liquidity clock to capitalize on what he calls "the greatest macro trade of all time."
