Raoul Pal is pushing back on the idea that crypto’s current drawdown signals a 
broken market cycle, arguing instead that bitcoin and high-beta risk are being 
hit by a temporary US liquidity air pocket tied to Treasury cash management 
and government shutdown dynamics. In a weekend post on X framed as a takedown 
of “false narratives,” the Global Macro Investor founder said the prevailing 
story—“that BTC and crypto are broken. The cycle is over”—has become an 
“alluring narrative trap,” especially as “prices [are] puking each and every 
fucking day.” But Pal said a separate question from a GMI hedge fund client 
about beaten-down SaaS equities prompted him to re-check the data and rethink 
the driver. “What I found destroyed both the BTC narrative and the SaaS 
narrative,” Pal wrote. “SaaS and BTC are the EXACT same chart. Huh? That means 
there is another factor at play that we have all missed…” Crypto Slide Due To 
US Liquidity Drain? Pal’s answer is liquidity. He argues US liquidity has been 
“held back” by two shutdown episodes and “issues with US plumbing,” adding 
that the drain of the Fed’s reverse repo facility was “essentially completed 
in 2024.” Related Reading: White House To Host Crypto And Banking Leaders In 
Push To Break Regulatory Deadlock That, he said, left the Treasury General 
Account (TGA) rebuild in July and August without the kind of offset that would 
normally soften the impact, turning it into a net drain. In his telling, the 
same lack of liquidity helps explain why macro activity gauges have looked 
weak, writing that “lackluster liquidity is the reason why the ISM has been so 
low.” While Pal said he typically tracks global total liquidity because of its 
long-term correlation with bitcoin and US tech, he argued the US measure is 
dominating this phase of the cycle because the US remains the system’s key 
liquidity supplier. That matters, he said, because the assets most exposed to 
a withdrawal of liquidity are long-duration, high-volatility exposures—exactly 
where bitcoin and SaaS sit in many portfolios. “Those are both the longest 
duration assets that exist and both got discounted because liquidity was 
temporarily withdrawing,” Pal wrote, tying their drawdowns to the same macro 
impulse rather than project-specific failure or a broken crypto “cycle.” He 
also pointed to gold’s rally as an additional constraint on marginal flows. 
“The rally in gold essentially sucked all marginal liquidity out of the system 
that would have flowed into BTC and SaaS,” Pal said. “There was not enough 
liquidity to support all these assets, so the riskiest got hit.” Pal described 
the latest shutdown as a further headwind, claiming the Treasury “hedged” by 
not drawing down the TGA after the prior shutdown and instead “added more to 
it,” deepening the drain. That, he said, is the “current air pocket” behind 
the “brutal price action” across risk. But he also argued the squeeze is close 
to clearing. “However, the signs are that this shutdown will get resolved this 
week and that is the FINAL liquidity hurdle out of the way,” Pal wrote, adding 
that the next phase could bring a “liquidity flood” from factors he listed 
including changes around eSLR, partial TGA drawdowns, fiscal stimulus and rate 
cuts. Related Reading: Crypto Bears Beware: Global Liquidity Cycle May Be The 
Longest On Record He extended the “false narrative” theme to Fed expectations, 
rejecting the idea that Kevin Warsh would run policy as a hawk. “On the 
subject of rate cuts, there is another false narrative going around that Kevin 
Warsh is a hawk,” Pal wrote. “It is utter fucking nonsense. These were 
comments mainly from 18 years ago.” Pal argued Warsh’s mandate would align 
with what he called the “Greenspan era playbook”—cutting rates, letting the 
economy run hotter, and leaning on productivity gains to restrain core 
inflation—while avoiding balance-sheet moves that could collide with reserve 
constraints and destabilize lending. Pal included a mea culpa, acknowledging 
GMI “was not seeing the US liquidity as the current driving factor,” after 
years of emphasizing global measures. “There is no disconnect,” he wrote. 
“It’s just that the confluence of events Reverse Repo drained &gt;TGA rebuild &gt; 
Shutdown &gt; Gold rally &gt; Shutdown was not forecastable by us, or in any event 
we missed the impact.” His bottom line was less about calling the exact bottom 
and more about time-in-cycle. “Often in these full cycle trades, it is time 
that is more important than price,” he wrote, urging “PATIENCE!” and 
reiterating he remains “HUGE” bullish on 2026 if the policy and liquidity 
playbook he expects materializes. At press time, BTC traded at $77,510. 
Featured image created with DALL.E, chart from TradingView.com

Crypto Isn’t Broken, It’s A US Liquidity Squeeze, Says Raoul Pal

Ron Paul says the global fiat monetary system is nearing a “climactic end,” 
warning that soaring debt, currency debasement, and political overreach are 
pushing the dollar—and the broader world order—toward a dangerous reckoning. 
Liberty Advocate Ron Paul on Debt, Gold, and Why the Dollar’s Decline May 
Accelerate Speaking with David Lin on The David Lin […]

Gold at $20K? Ron Paul Says Fiat Currency Breakdown Makes It Possible

The meeting came more than two weeks after the Senate Banking Committee 
postponed a markup on the CLARITY Act, adding that everyone “remains at the 
table“ to work on the bill.

White House officials met with crypto execs to discuss market structure bill

Robinhood plunges 10% to 7-month low as crypto correction, NFL slowdown, and 
rising costs weigh ahead of February 10 earnings.
The post Robinhood stock sinks 10% to 7-month low as crypto correction deepens 
appeared first on Crypto Briefing.

Robinhood stock sinks 10% to 7-month low as crypto correction deepens

Bitmine Immersion Technologies has crossed a milestone that is hard to ignore: 
the firm now controls 3.55% of Ethereum’s total token supply, putting it more 
than 70% of the way toward its self-styled “Alchemy of 5%” goal in just six 
months, according to company disclosures. Digital Asset Firm Bitmine Deepens 
Ethereum Bet Bitmine Immersion Technologies […]

Cryptocurrency price in USD