- Raoul Pal says Bitcoin now follows global liquidity cycles, not four-year halving schedules.
- Institutional inflows and stablecoin growth suggest consolidation, not a market top.
- Macro liquidity expansion could drive a major crypto breakout in 2026.
Raoul Pal believes crypto investors are misreading the current market. Price charts flash red, yet capital flows remain resilient. Many traders still rely on the familiar four-year rhythm that shaped past cycles. That framework no longer dictates Bitcoin’s trajectory. According to Pal, global liquidity now drives direction, while fear reflects outdated habits rather than present realities.
The Four-Year Playbook Has Finally Broken
For more than a decade, Bitcoin followed a clear pattern built around halvings. Supply shocks triggered rallies, retail piled in, and harsh winters followed. That model worked when Bitcoin functioned as a niche asset. Market structure has since evolved, reshaped by institutional capital and global adoption. Spot Bitcoin ETFs now manage more than $125 billion. Sovereign entities, pensions, and macro funds treat Bitcoin as a global financial instrument.
These players respond to liquidity cycles rather than preset calendars. As a result, halving-based forecasts struggle to explain current behavior. Recent price moves have unsettled investors. Bitcoin has declined nearly thirteen percent since early November, while Solana has corrected over seventeen percent. Traders trained by historical volatility see danger in such pullbacks. Flow data, however, paints a calmer picture.
US spot Bitcoin ETFs have attracted $22.47 billion in net inflows this year. That level of demand clashes with a bearish narrative. The market appears to be digesting gains rather than preparing for collapse. Consolidation fits better than exhaustion. Raoul Pal addressed this divide during Binance Blockchain Week Dubai 2025. Pal rejected blind faith in the Satoshi cycle. Liquidity, not tradition, now controls price discovery. Global liquidity trends suggest expansion rather than contraction.
Why 2026 Could Shock the Market
Pal anchors the thesis on macro liquidity. Global M2 supply and central bank balance sheets show a strong correlation with Bitcoin performance. This relationship outweighs halving effects. Several catalysts could ignite liquidity expansion in early 2026. Fiscal stimulus ranks among the most important drivers. Policy shifts in the United States could inject fresh capital into markets.
Banking regulation changes add another powerful lever, particularly adjustments to the Supplementary Leverage Ratio. Lower Treasury risk weights would allow banks to purchase bonds more aggressively. Such activity creates liquidity across financial systems. That liquidity often flows toward risk assets. Bitcoin stands to benefit directly from this process. Altcoins also respond to macro shifts. The ISM Manufacturing Index crossing above fifty often sparks risk-on rotation.
When economic momentum improves, capital typically moves down the risk curve. Altcoins behave like small-cap equities during such phases.Institutional accumulation continues to tighten supply. Public companies now hold more than one million Bitcoin. Corporate balance sheet demand differs from retail speculation. Long-term strategies reduce circulating supply and dampen downside pressure.
