Real Vision CEO and former Goldman Sachs executive macro investment expert Raoul Pal explained why he shifted more than half of his portfolio to Bitcoin.
In a new interview with The Breakdown podcast host Nathaniel Whittemore, Pal says he believes Bitcoin is currently the largest reserve asset in the world despite high volatility levels.
“Now I am firmly of the opinion that Bitcoin is the world’s largest reserve asset. Yes, we have a lot of volatility for this right now but I can’t blame it. It doesn’t work or might work for a lot of things but it’s probably not good enough and maybe that’s not the role. But can it be the cornerstone of everything? Here he has a very good chance at that. ”
Pal said that when it comes to store of value assets, a meeting with MicroStrategy CEO Michael Saylor opened his eyes on why Bitcoin is superior to gold:
“If you look at the gold supply, it is 2% per year, so they cause gold to devalue at 2% per year, because demand is not balancing supply … And if you think that this is basically the inflation rate and you combine it, you actually lose your purchasing power. I looked at the top four central bank balance sheets against all in terms of growth rate of change. Gold has done well. It performed 50% below the balance sheet. The only asset in the world that performs better than the G4 balance sheet is Bitcoin. This is the only one. ”
The First Stages of a New Bull Run
Pal says he believes Bitcoin is in the early stages of a new bull run and that eventually the price of a BTC could reach $ 1,000,000. He says that Bitcoin’s volatility will eventually decrease as its market value grows and institutions find legally compliant ways to enter this space:
“Bitcoin was unique. It started out as a shock wave. It came from individuals. Nothing else came this way. And now we have to enter as institutions. Institutions will monitor the price, but as long as this is not an asset for them — that is, they can keep it, evaluate it, put it into account — they won’t do anything. ”
Emphasizing the real market value, the investor used the following statements:
But what will drive them is not performance, but the actual market value of the asset itself. Remember, we’ve seen this in the hedge fund industry. Bitcoin will transform from a rocket ship to a cruiser. And it has to be. But not yet. We want to do this at a higher price. ”
When asked how his thoughts on Bitcoin could change, Pal pointed to the rise of emerging markets as the only thing:
“If the dollar falls, there could be emerging markets. That’s all I can see as being able to compete for my Bitcoin capital over a three-year time horizon. “