Raoul Pal is pushing back on the idea that crypto\u2019s current drawdown signals a broken market cycle, arguing instead that bitcoin and high-beta risk are being hit by a temporary US liquidity air pocket tied to Treasury cash management and government shutdown dynamics.<\/p>\n
In a weekend post<\/a> on X framed as a takedown of \u201cfalse narratives,\u201d the Global Macro Investor founder said the prevailing story\u2014\u201cthat BTC and crypto are broken. The cycle is over\u201d\u2014has become an \u201calluring narrative trap,\u201d especially as \u201cprices [are] puking each and every fucking day.\u201d But Pal said a separate question from a GMI hedge fund client about beaten-down SaaS equities prompted him to re-check the data and rethink the driver.<\/p>\n \u201cWhat I found destroyed both the BTC narrative and the SaaS narrative,\u201d Pal wrote. \u201cSaaS and BTC are the EXACT same chart. Huh? That means there is another factor at play that we have all missed\u2026\u201d<\/p>\n Pal\u2019s answer is liquidity. He argues US liquidity has been \u201cheld back\u201d by two shutdown episodes and \u201cissues with US plumbing,\u201d adding that the drain of the Fed\u2019s reverse repo facility was \u201cessentially completed in 2024.\u201d<\/p>\n That, he said, left the Treasury General Account (TGA)<\/a> rebuild in July and August without the kind of offset that would normally soften the impact, turning it into a net drain. In his telling, the same lack of liquidity helps explain why macro activity gauges have looked weak, writing that \u201clackluster liquidity is the reason why the ISM has been so low.\u201d<\/p>\nCrypto Slide Due To US Liquidity Drain?<\/h2>\n