In a recent interview with Daniela Cambone, former hedge fund manager Raoul Pal said that bitcoin could reach $1 million in the next five years.
Pal is the CEO and co-founder of Real Vision Group, describing himself as an economist and investment strategist.
In the past, he co-managed the hedge fund sales business at Goldman Sachs in the equity and derivatives market in Europe and then co-managed the GLG Global Macro Fund in London.
He believes it is possible that large investors may adopt bitcoin as an investment and store of value, and a “enormous wall of money” will enter this market in the coming years.
This should raise the price of BTC significantly over the next 5 years.
Pal argues that the crisis in the global economic system will last longer than expected. This is causing a shortage of cash flow to companies, many of which are already closing. The only possible answer, for Pal, is that of the central banks, and he says that is why he has started buying more and more bitcoin.
Raoul Pal and Bitcoin
Although he also holds US dollars, gold and stocks in his portfolio, he says that BTC currently accounts for probably more than 50% of his allocations.
However, he also says he is aware of the risks, but believes that possible gains are more likely.
In particular, he reveals that he has recently reduced his liquid assets to invest in bitcoin.
He maintains only relatively small trading positions, as he does not believe that the stock market can currently offer as many opportunities as bitcoin.
Pal also states that he is not a big gold appreciator, and believes that if bitcoin were to break the current trend upwards, it should massively outperform gold.
One curious thing is that according to Pal there would be no real and significant risks of a hyper-inflationary spiral on the US dollar, or that the US might go into default, but he suggests that a new unit of measurement should be adopted to monitor the return on his savings and reserve assets.
In such a scenario, large amounts of capital will flow into bitcoin in the coming years, particularly from large investors.
“We’re starting to see family offices in the space. Next is the institutions, the endowments, the pension plans, and within that you’ll find some government … suddenly say we have allocated 5% in bitcoin”.
It’s no coincidence that he also mentioned the case of MicroStrategy, which was, in fact, the first company to do this on a large scale.
Although these are, in his view, the prerequisites that could raise the price of bitcoin to $1 million over the next 5 years, he did not explain how he calculated this figure. However, it is possible to imagine that it is linked to that 5% of funds hypothetically allocated in bitcoin by the institutional investors he mentioned.