Raoul Pal Ethereum – Ridiculous End Of Year Coming (Massive 4x By December)
Adventures in crypto is basically my learning journey. I am learning along with everybody else and im taking everybody with me. There are no answers here. This is not like the macro world, where you kind of know how things work and its deciding which way its going to go. Is it this path or that path? This is like its an unknown future and we all have to figure it out while sprinting a marathon, so its immensely hard work, theres incredible amounts of input of new information coming that its overwhelming us all. So what im trying to do is build this framework. In my head that allows me to take into account all the things that are happening without having to be an expert on all of them, and i want to be an expert in some of them, so thats how im approaching it um its impossible to be an Expert on everything and anybody who tries will just die of overwork so so the best thing is that, so what am i looking at lets start first, with okay ive explained to everybody now that this is the fastest adoption of any technology in all recorded history. So the chart you can see on the screen now shows that the internet back in 1997, when it had 150 million users, was growing at 63 a year, 150 million users in crypto is present day and its growing at 113 a year. So this is why its so hard for us all to catch up, because its growing at a ridiculous pace and its only accelerating i mean weve, seen in the last year alone, the rise of d5 nfts dows central bank digital currencies, um stable coins.
You know in a in a way that none of us could have expected its just happened so fast at such scale, and thats only going to continue and thats a core philosophy of the exponential eight. How i look at this to frame it simply is. This is currently a two and a half trillion dollar asset class. It is if you compare the other asset classes theyre between 150 and 300 trillion until you get to derivatives, which are one quadrillion and then, when you get to fx its multiple quadrillions. So the reality is. If we continue this rate of adoption, we should get to an equivalent size asset class in these digital assets, and that would make them worth 200 trillion. We have never in all of human history being given an opportunity that an entire asset class, not a stock, not a single token. An entire asset class goes up 100 x in value, probably by the end of this decade. So if ive talked about before this is, i think, the largest distribution of wealth and fastest distribution of wealth in all recorded history, because, unlike most other wealth distributions things like railroads, phones, even computers and even the internet, they are crewed to giant companies. This is accruing to tokens which anybody can participate in because you could own a fraction of a token. So bitcoin, as of today, is 60 something thousand uh. By the time this interview comes out. My guess is going to be a bit higher um, but you can own a small fraction.
You can have ten dollars in it, so everybody can participate in this right. This is incredible, and this is why im so passionate about this space is. I was driven on a mission after 2008 and 2012, the european crisis, to tell people about the risks and opportunities. I didnt want somebody to come to me and said why didnt i know my job. The whole job of real vision is to make sure everybody knows so ive been banging the table as loudly as possible. Saying look, there are no certainties in this world, but this is the highest probability, opportunity ive ever seen and the biggest magnitude of any opportunity. Ive ever seen in my entire career or ive ever heard about so thats the scale and thats, why? I am crazy interested in this. I have been following metcalfes law, as my guide for this metcalfes law is about. How do you value a network and its about? Basically, the number of people on the network, plus the number of connections between those people and the more connections and the more applications built on top of those people, the more valuable it is so the biggest network is currently bitcoin and bitcoin has less applications built on It than ethereum does, but it has more users, so its immensely valuable. It has the store of value proposition that most people are familiar with. What is interesting is adoption effects seem to repeat themselves. They say it seems to be a human behavioral thing.
So if you look at this next chart, bitcoin now is basically exactly following bitcoin 2013 in price structure, its weird, but this is not a chart. Ive just pulled up today, ive been following this for a year and a half once i first started discovering metcalfes law and im like bloody hell. This is weird, but it gives you a rough idea. I dont expect it to be perfect, but it gives you a rough idea and what im expecting is a gigantic rally into year? End and well talk a bit about an extended cycle in a sec, its a spooky chart its a fractal chart. It shows the self similarity of growth within bitcoin at different points in the adoption cycle. Yeah and if you remember 2013, was a hell of an adoption cycle, it was the initial one and it had some violent moves, its kind of suggesting violent moves. You know just by using that chart, it gets me somewhere like 300 000 bitcoin um, a price range, okay, thats above most peoples expectations, but i dont see any reason why the charts not going to work and well come a bit more about how this cycle plays Out in a sec, but the other killer chart is once i start discovering metcalfes law. I start realizing that ethereums exactly following bitcoins last cycle and its like. Oh my god, this is spooky. I mean ive got actually on my bloomberg in real time and it almost works.
Tick for tick, ive, never seen anything like it, and that gives a cycle projection for ethereum of 20, 000 and again i actually think its kind of overshoot, but i thought well, if my logic about metcalfs law is right, then these layer ones that well talk about Later should also fit, and bizarrely heres the chart of solana against ethereum in the last cycle when ethereum was the darling, the new breakthrough its exactly following, and the same is true of terror, its exactly following its like wow. So as these different protocols get adoption, theyre all behaving in the same way, well bitcoin is is repeating its early cycle of massive adoption. So for me this is super. Interesting and again, i dont expect these to be perfect, but theyre contextualizing network adoption, which is, i think, everything in this space for the time being until we start moving into some of the other things. So how do i think this plays out because thats what everybody cares about, i honestly think were going to have a ridiculous year end but heres the rub is weve got different people actors in the business now. So if you are blackrock or you are tudor and you have bitcoin at end of year, if you are blackrock and lets say, im right and bitcoin goes up 4x into the end of the year or 3x. You are going to rebalance and sell some bitcoin. If you are tutor, you come into the end of the year.
You want to lock in your gains because you get paid your annual performance fee in january, so you will probably flatten out your p l. So what happens is we might see selling towards the end of december, which the market is going to go? The cycles finished because everybodys kind of expecting a december end because it was 2013 and 2017 where the bitcoin cycle ended in december. However, i think the structure has changed.