Raoul Pal: Important Warning To All Small Bitcoin & Crypto Investors (New 2026 Prediction)

Raoul Pal, founder of Real Vision and one of the most respected macro investors in the world, explains why 2025 was not the death of the crypto bull market but rather a liquidity drought that created one of the biggest asymmetric setups he has ever seen.

While technology stocks hit new highs and gold suddenly outperformed, crypto felt like the most uncool asset in global markets. A supposed fourth year bull cycle somehow went negative. Every rally got sold. Every positive data print got ignored. And behind the scenes, something far more technical was unfolding.

In this video, we break down Raoul's full explanation of what went wrong and why he believes the next move could catch almost everyone off guard. He traces the breakdown to July 2025 when the US Treasury began rebuilding its general account, pulling roughly $700 billion out of the system.

At the same time, the reverse repo facility that had been acting as a liquidity buffer was fully drained. With no meaningful offset, the most risk-sensitive assets felt it first.

Crypto sits furthest out on the risk curve and took the hardest hit. A government shutdown scare and renewed tariff tensions with China only made things worse.

Raoul also addresses the October 10th flash crash and shares his theory about what may still be weighing on the market. He believes that when everything broke that day, a major exchange or affiliated market-making entity may have been forced to absorb as much as $20 billion in liquidated positions.

Working through that kind of inventory in illiquid altcoins takes time, and it creates constant supply pressure that can suppress rallies even when the news is overwhelmingly positive. He describes the daily selling pattern since October as systematic and mechanical, not the kind of behavior you see from retail panic or emotional capitulation.

What makes this moment so confusing is the disconnect between price action and fundamentals. Raoul spent time in Abu Dhabi and Dubai speaking with sovereign wealth funds, major exchanges, and institutional desks. The message was unanimous. Inquiries are flooding in.

Institutions are onboarding. Financial companies are asking how to build on stablecoin rails, how to tokenize equities and bonds, and how to use blockchain for collateral management. The DTCC itself has been exploring blockchain-based settlement. Yet prices have done nothing.

That disconnect, Raoul argues, signals a liquidity distortion rather than a thesis failure.

Looking ahead, Raoul believes 2026 is too politically important for liquidity to remain tight. The system carries massive debt obligations and servicing that debt requires capital to circulate. Rising interest costs on government debt are not theoretical.

They are math. Between fiscal stimulus, potential changes to bank leverage rules, Treasury balance sheet management, and expanded use of repo facilities, the system could see trillions of dollars injected or freed up over the next 12 months.

A Treasury Secretary who openly talks about strengthening the business cycle ahead of midterm elections only reinforces the direction of travel.

Raoul frames the current environment not as the end of a cycle but as a coiled spring. The market has been compressed by a liquidity vacuum and weighed down by structural selling.

But when mechanical supply finally exhausts itself and liquidity turns decisively, the repricing could be swift. What feels like stagnation today could look like accumulation in hindsight.

Disclaimer: This video is for informational and entertainment purposes only and should not be considered financial advice. Always do your own research before making any investment decisions.

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