How to Trade Crypto Cycles with Raoul Pal

Bullish:

• $TECH - Technology and crypto represent the greatest macro trade of all time, with the digital transformation supercycle still ongoing

  • “Between what's happening in technology and crypto, this is the greatest macro trade of all time. And it's not over yet.”

    Raoul·1:02:28
• $BTC - Bitcoin's price movements are 90% explained by global liquidity, making it highly correlated with liquidity cycles

  • “Liquidity, we found in our work at Global Macro Investor, using the total global liquidity explains 95% or 97% of Nasdaq's price movements over time since 2012, and 90% of Bitcoins. So it is the single most dominant macro factor.”

    Raoul·2:53
• $SUI - Current L1 allocation after successfully rotating from Solana, despite giving back some gains

  • “Bought Solana at the lows and then switched into SUI when it had its run. I just given a bit back. But generally, that's worked fine.”

    Raoul·8:12

  • “The last time I changed in asset allocation in my own personal portfolio was 2024 when I switched Solana for SUI.”

    Raoul·42:26
• $SOLAR - Solar is the fastest and cheapest source of scaling energy for AI infrastructure, with China deploying more solar in 12 months than the rest of the world combined

  • “Look what China did. Yes, they're building nuclear, but they scaled more solar in twelve months than the entire solar supply of the rest of the world. They're telling you what the fastest source of energy is. The fastest, cheapest source of scaling energy is solar.”

    Raoul·56:07
• $SOL - Successfully bought Solana at the lows as part of L1 rotation strategy that outperformed Bitcoin

  • “I haven't been in Bitcoin all cycle. I've managed to outperform it via just having the right allocation. Bought Solana at the lows and then switched into SUI when it had its run.”

    Raoul·8:12
• $NATGAS - Natural gas is the bridge solution for AI energy needs, deployable in about two years between solar (12 months) and nuclear (long-term)

  • “Then it's natural gas. So you can get a natural gas plant up in about two years. So natural gas, so solar first, you can get that going in twelve months or less. You've got then natural gas behind it.”

    Raoul·56:47

Bearish:

• $DEFI - DeFi protocols are inferior investments compared to L1 networks because they're cash-flowing businesses rather than networks with multiplier effects

  • “I still think that even though it looks attractive to use discounted cash flow models, to look at cheapness of DeFi, you just won't make as much money over time because of how a network multiplier works.”

    Raoul·17:12
• $ADA - Cardano lacks economic activity on-chain despite having holders, making it an outlier that doesn't fit network valuation models

  • “Things like Cardano will be an outlier. Because there's very little economic activity on the chain. There's quite a lot of holders, but they're not super active.”

    Raoul·12:30
• $ETH - Ethereum's valuation at 400 billion with only 1-2 billion in fees represents 200-400x revenue multiple, making it overpriced from a fundamental perspective

  • “Even like Ethereum at 400,000,000,000. It's only cranking out 1 or 2,000,000,000 of of fees. You know, two to 400 times revenue seems widely reprised, certainly not a value buy in my mind.”

    Santi·11:08