Infrastructure Layer Poised for Next Big Crypto Move: Pal
Renowned investor and macro trader Raoul Pal has made waves in the crypto community by predicting that the next 100x trade won't be in Bitcoin, Ethereum, or XRP, but rather in the infrastructure layer of the market. This layer includes decentralized physical infrastructure projects and application-specific chains that have been largely overlooked by institutions and mainstream investors.
Pal's investment framework is based on global liquidity, which he tracks through a combination of central bank balance sheets, G20 money supply, and foreign exchange reserves. He has found that there is approximately 90% correlation between Bitcoin's price and this measure over the past decade.
According to Pal, global liquidity is currently entering a new expansion phase, with central banks outside the US already easing monetary policy. This trend is expected to continue regardless of the Federal Reserve's decision at its upcoming FOMC meeting.
The rotation sequence that has played out in every prior cycle suggests that capital will first flow into Bitcoin, followed by Ethereum and large-cap altcoins, and then finally into smaller infrastructure assets. It's this final rotation that has historically produced the most extreme percentage returns due to the lack of institutional ownership in these assets.
On-chain signals are converging, including long-term holder accumulation at a six-year high and a significant decline in Bitcoin exchange reserves. These signs suggest that the current moment may be the start of something big.