Everyone is wondering whether Bitcoin’s recent weakness signals the start of a bear market. However, macro investor Raoul Pal says that a drop to $60,000 would not change the bigger picture.
Liquidity Remains the Key Driver
According to Pal, the main argument is global liquidity. According to him, liquidity continues to expand across major economies, including the U.S. and China, creating a supportive environment for risk assets like Bitcoin.
“Liquidity is flowing,” Pal said, adding that global liquidity growth is still accelerating. As long as that trend continues, he does not see a reason to become overly concerned about the broader crypto cycle.
A Deep Correction, Not a Bear Market
He described a potential drop from $126,000 to $60,000 as “a nasty correction in a bull market” rather than a full market reversal.
Drawing on his experience since entering crypto in 2013, he noted that Bitcoin has experienced multiple 50% corrections during previous bull cycles. While such declines often trigger fear among investors, he argued they are a normal part of crypto market behavior.
“But people forget this every time,” he said.
Altcoins Usually Fall Even Harder
He also pointed out that altcoins typically experience larger drawdowns when Bitcoin corrects.
As an example, he highlighted Solana, which fell roughly 80% during 2021 despite being in the middle of a broader bull market. After that decline, SOL went on to deliver a major rally.
According to him, this pattern has repeated across multiple cycles and is not unique to Solana. Similar pullbacks have occurred in Bitcoin and Ethereum before strong recoveries.
Why This Cycle Feels Different
One reason investors may feel more pessimistic today is the pace of the correction. He noted that previous declines were often sharp and followed by quick recoveries. This cycle has been slower, with prices moving sideways and lower over several months.
That prolonged consolidation has created more frustration and uncertainty among market participants.
Moreover, he suggested that a slower, more drawn-out correction could actually support a longer and more sustainable bull market. Rather than seeing the current weakness as the end of the cycle, he views it as a normal reset within a broader uptrend, provided global liquidity conditions continue improving.