Raoul Pal Says Bitcoin Tracks Global Liquidity With 87% Accuracy

The digital asset market continues to fuel debate on the factors that truly influence prices. For Raoul Pal, founder of Real Vision and former fund manager at Goldman Sachs, the answer is not found in announcements or traditional fundamentals. According to him, Bitcoin mainly moves in line with global liquidity. This analysis, which he has supported for several months, is based on a strong correlation between the available money supply and financial market performance.

Bitcoin moves primarily according to global liquidity

Raoul Pal has been stating for several months that liquidity conditions are the main driver of financial markets. In a post published on X, he explains that Bitcoin shows an 87% correlation with global liquidity. He adds that the Nasdaq displays an even higher correlation, at 97%, which illustrates, according to him, the weight of monetary flows on financial assets. He wrote:

Bitcoin shows an 87% correlation with global liquidity. The Nasdaq shows a 97% correlation. This reveals a reality that most people never realize. These assets do not actually trade based on financial results, news, or the week’s major events. They follow the evolution of the money supply in the system.

Raoul Pal, founder of Real Vision. Source: X / @RaoulGMI

Global liquidity corresponds to the total volume of money available in the financial system. Observers evaluate it notably from central bank balance sheets, the global M2 money supply aggregate, and the growth of bank credit. For Raoul Pal, these elements influence prices more than financial results, media events, or weekly news.

This view leads to considering markets from a macroeconomic perspective. Asset movements would then mainly reflect the evolution of the available money supply rather than factors specific to each sector.

A thesis reinforced by Keyrock’s work

Keyrock’s analyses go in the direction of this approach, even if they use a different methodology. The cryptocurrency market maker has developed a model integrating about an eight-month lag between US Treasury bond issuances and Bitcoin returns.

To establish this relationship, Keyrock uses a net liquidity indicator. This corresponds to the Federal Reserve’s balance sheet, from which Treasury cash balances and repurchase operations are subtracted. The objective is to measure the portion of liquidity that actually reaches financial markets.

According to this approach, the effects of liquidity injections do not manifest immediately. The variations observed today often reflect monetary conditions established several months earlier. This timing explains why market movements can seem disconnected from immediate news.

A position already defended for several months

Recent statements by Raoul Pal extend an analysis he already presented in May on Real Vision. At that time, he estimated that Bitcoin showed a correlation close to 90% with global money supply.

He also explained that the cyclical refinancing of global debt forces central banks to regularly inject new liquidity to avoid systemic risk. According to him, this mechanism would repeat approximately every four years, creating a favorable environment for the expansion of central bank balance sheets.

This reading also forms the basis of his price target of $450,000 for Bitcoin. However, he specifies that this projection depends directly on a significant increase in global liquidity before the end of the year. Without this monetary evolution, his scenario would lose part of its foundation.

The Nasdaq and capital flows take a central place

One of the most striking figures advanced by Raoul Pal concerns the 97% correlation between the Nasdaq and global liquidity. Such proximity suggests that major tech stocks and Bitcoin today react to the same macroeconomic conditions rather than specific catalysts.

This analysis calls into question the idea that the market mainly depends on halving cycles, supply scarcity, or announcements related to cryptocurrency adoption. From this perspective, capital flows would gradually become the main driver of performance.

Michael Saylor shares a similar view. The Executive Chairman of Strategy believes that the traditional four-year halving cycle is no longer the dominant model. He now considers that capital inflows into ETFs, accumulation by corporate treasuries, sovereign reserves, and global liquidity conditions play a more decisive role. According to him, over the next decade, Bitcoin’s trajectory will depend more on capital flows than on miners’ issuance pace.

The data presented by Raoul Pal remain methodologically incomplete. He publishes neither all the data used nor the detailed calculations to verify these correlations. Meanwhile, Keyrock’s work also shows that the relationship between BTC and global liquidity varies over time and shows a significant lag. The coming months will thus allow observation of whether the evolution of central bank balance sheets confirms or not this macroeconomic reading of the markets.