Amid a widespread financial crisis that has seen multiple banking giants collapse and more at risk, Raoul Pal, a former hedge fund manager, believes that this situation could further strengthen the power of Bitcoin (BTC) as well as the cryptocurrency market as a whole.
Due to this declining trust in banks and people fleeing into alternative systems, becoming aware of their benefits amid crises, Pal believes that the crypto industry and Bitcoin could explode in the future, closely resembling the chart patterns from 2013, as he explained in an interview with Anthony Pompliano published on March 20.
“I think there is a potential setup here for Bitcoin and the whole crypto market actually, to be shockingly strong, more like in 2013 than 2019 [when] we had that big correction (…) partially due to the G5 central banks’ balance sheets that were contracting over that period of time, and it pulled back the crypto market.”
Indeed, Pal, who retired from his position at the age of 36, said that he got into Bitcoin in 2013 because he realized there was no trust in the banking system after the financial ruin of the investment banking company Lehman Brothers.
“When you realize that, in a bank, you don’t actually own your money, and people are now realizing that, and the Treasury and the FED are like ‘well, we’ll just pretend that’s okay,’ that drives people into this parallel financial system. I got into Bitcoin in 2013 for exactly this reason and have been an active participant in the market ever since.”
Crypto and Bitcoin explosion
The former hedge fund boss did admit that Bitcoin’s volatility was what made people skeptical about its ability to act as a wealth preservation asset “because, in people’s minds, the time horizon is too short.” However, “if you hold it long enough, it does extremely well, it does better than the FED balance sheet, better than any other asset in existence.”
Pal also expects there would be “a gigantic pushback from the government as more people move out of the system and into the Bitcoin market,” but if the United States fails to understand that people have “awoken to the fact that there is another way out of this,” many crypto companies could move to the United Kingdom.
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Featured image via Real Vision Finance YouTube.