Raoul Pal’s Warning Starts to Play Out
Six months ago, Raoul Pal, one of the most influential macro analysts in the world and former head of a hedge fund at Goldman Sachs, publicly outlined a scenario for Bitcoin. According to his view, BTC would continue rising within a prolonged business and debt cycle, followed by a sharp correction of approximately 35%.
At the time, many dismissed the outlook as overly pessimistic. Today, that exact scenario is unfolding.
Bitcoin Hits a 36% Pullback From Its All-Time High
As of now, Bitcoin has traded approximately 36% below its historical peak. The pullback places the market directly in the range Raoul Pal anticipated, both in magnitude and timing.
This retracement has triggered fear among retail investors, with many interpreting the move as the beginning of a deeper or even terminal decline.
“Everyone Will Think It’s Over — But It Isn’t”
According to Pal, the psychological impact of such a correction is part of the natural market cycle. When price falls sharply after a powerful rally, confidence collapses. Investors start to believe the bull market is over.
However, Pal consistently emphasized that this stage does not represent the end — but a reset phase before the next wave of expansion driven by liquidity, macro shifts and renewed capital inflows.
The Concept of “Banana Zones”
Raoul Pal is also known for introducing the concept of “banana zones” in crypto markets. These are intense, parabolic growth phases linked to global liquidity cycles.
In simple terms, when liquidity expands and macro conditions align, Bitcoin and crypto assets can enter vertical growth periods that far exceed traditional expectations.
From this perspective, the current drawdown could represent the final emotional washout before another acceleration phase begins.
Macro Cycles Still Point to Long-Term Expansion
While short-term price action remains volatile, Pal’s broader thesis is based on deep macroeconomic forces:
• Global debt expansion
• Central bank liquidity cycles
• Currency debasement
• Technological adoption curves
If those forces remain in place, the long-term upward trajectory of Bitcoin and digital assets may still be intact, despite painful intervening corrections.
A Test of Conviction for the Market
The present moment is now becoming a psychological test for the entire market. Panic, doubt and confusion dominate sentiment — exactly as Pal predicted.
Whether history will fully repeat itself remains to be seen, but one thing is clear: this is the same stage where many give up right before the cycle turns again.
