Here's what I've noticed interesting in recent days. Raul Pal, a well-known macroeconomic analyst, posted a quite intriguing analysis on X that overturns the usual view of the current situation in the crypto market. All these talks about the market supposedly dying and ending — he strongly disagrees with that.

The essence of his position is one: global liquidity is not just an important factor, it is actually the most critical macroeconomic driver in history. And what’s striking is that the correlation between liquidity and BTC has been at 90% since 2012. For comparison, the correlation with the NDX index is actually 97%. This is no coincidence; it’s a systemic pattern.

Raul Pal emphasizes that the annual growth rate of liquidity is about 10%, and there are no signs of slowdown. Financial conditions measured by GMI are ahead of liquidity by about half a year and remain accommodative. During that pause, liquidity in the US was suppressed, creating a bearish range, but three months ago it started recovering at an accelerated pace. This indicator is about three months ahead of crypto.

The business cycle is now accelerating, and this is a key driver of returns and risk. The eSLR mechanism works through banks, which increase liquidity by lending and issuing government bonds. This liquidity is also growing and will continue to accelerate. Add to this tax refunds that flow into banks’ balance sheets, increasing their willingness to lend — liquidity is growing on all fronts.

Raul Pal also points out that the US will continue to cut rates, which will increase disposable income and risk appetite. The CLARITY law, expected to be passed, will open doors for many banks and asset managers interested in using crypto technology. Stablecoins are developing at explosive speeds — issuance grew by 50% last year and continues to accelerate. Trading volume has reached trillions of dollars.

Support for crypto from the US government has reached a historic maximum. Gradual adoption by agencies will significantly accelerate the development of the entire market and create a completely new serviced segment. According to most metrics, the market is in a state of historic oversold conditions, despite the panic prevailing in the crypto community. Raul Pal sees this not as the end, but as the beginning of a new cycle, where macroeconomic factors work in favor of the development of the cryptocurrency space.