Renowned macro guru and cryptocurrency enthusiast Raoul Pal recently sat down for an in-depth conversation on Bitcoin ETFs, NFTs, institutional investors, and more. He highlighted how one significant hurdle for institutions entering the crypto space is regulation and discussed how regulatory uncertainty can slow down the adoption of crypto assets and blockchain technology.
In a conversation with Scott Melkar, Pal opened up about one of the most significant recent developments in the crypto world is the anticipation of Bitcoin and Ethereum Spot ETFs. Pal discussed the potential impact of these ETFs on the crypto market. He doesn’t view them as a one-time event that will lead to an immediate price surge. Instead, he likens their impact to the Bitcoin halving events, where supply reduction gradually leads to price appreciation.
The Bitcoin Spot ETF and Ethereum Spot ETF are expected to bring more institutional money into the crypto market. However, the effects may not be felt immediately, and it could take some time for these events to lead to a noticeable price increase. Pal anticipates the entrance of institutional players like pension funds and larger asset managers into the crypto space over time, further boosting the market’s liquidity and growth.
He said, “The ETH spot ETF will happen as well; of course, it’ll be later; as soon as the Bitcoin one is done, they’ll front run it by going to the ETH one because they know that’s the next one. The Bitcoin ETF, I don’t think of the as a one-off event. People think of it as this liquidity injection into the crypto economy, and I’m saying it’s a trade agreement. Trade agreements start working when people get a return on their capital in that new economy, and then they pile in.”
Pal also touched on the future of non-fungible tokens (NFTs) and the tokenization of real-world assets. NFTs have been a significant trend in recent years, with various digital collectibles and art pieces selling for substantial sums. However, Pal expects that the initial hype around NFTs may die down and that the real potential of NFTs may be realized in the future.