Raoul Pal calls for ETH: based on the current trend, it has the potential to outperform BTC over the long term

Real Vision co-founder and CEO Raoul Pal, a former executive at Goldman Sachs, posted on social media on April 8, saying that the ETH/BTC exchange-rate trend is becoming “very interesting.” Pal said that the current setup is constructively aligned with the business cycle and the broader recovery in liquidity, and that if the ETH/BTC chart continues to develop along its current trajectory, Ethereum should eventually outperform Bitcoin over time.

ETH/BTC Trend: Constructive Alignment Between the Business Cycle and Liquidity

Pal’s bullish view is based on macro indicators. He noted that the ISM index (the Manufacturing Purchasing Managers’ Index) is currently trending upward. This constructive signal for the business cycle, combined with improving liquidity conditions, provides macro-level support for ETH’s relative performance versus BTC.

From a long-term chart perspective, the ETH/BTC exchange rate has broadly maintained its structural value, and recent price action shows that the conditions for a potential trend-based breakout are taking shape. Pal emphasized that if this trend continues, ETH’s outperformance of BTC could be a medium- to long-term structural shift aligned with the global business cycle, rather than a short-term speculative move.

The Fundamental Differences Between ETH and BTC: Analyzing the TAM Framework

Pal’s core logic is built on a differentiated analysis of the total addressable market (TAM) accessible to the two assets.

Raoul Pal’s Core Argument on the Fundamental Differences Between ETH and BTC

BTC’s position: primarily as a “store of value” asset, carrying the wealth stock of total global savings; its TAM corresponds to the scale of wealth accumulated by humanity over long cycles

ETH’s position: as an intelligent contract platform, capable of carrying the flow value of economic activity itself; its TAM extends beyond wealth stock to encompass global day-to-day economic activity

Long-term trend inference: as the application of smart contracts in the global financial system continues to expand, the dominant position of smart contract platforms relative to pure-value BTC has an inherent long-term expansion logic in terms of market-cap share

This framework implies that ETH/BTC’s long-term trend depends not only on sentiment in the crypto market, but also closely on the scaling progress of global smart-contract applications.

Raoul Pal’s View of the BTC Cycle: The Five-Year Supercycle Thesis

Pal also takes a long-term bullish stance on Bitcoin itself and questions the mainstream “four-year cycle theory.” He believes that, due to declining liquidity across the global financial system, Bitcoin is currently in an extended five-year supercycle, and the real bear market has not started yet.

Bitcoin hit a high above $126k in October 2025. Since then, it has continued to fall due to liquidation pressures and profit-taking, and it has recently dropped again below $69,000. Pal’s view is that Bitcoin’s bull-cycle has not truly ended yet, and that Bitcoin could reach the final peak of this cycle in the second quarter of 2026. He said that BTC’s price action is highly synchronized with the global business cycle, and that the business-cycle improvement signal represented by the current rise in the ISM index provides macro support for Bitcoin’s further upside.

Frequently Asked Questions

Why does Raoul Pal believe ETH can outperform BTC long term?

Pal’s core argument is the fundamental difference in TAM (total addressable market). BTC primarily carries the wealth stock of global savings, while ETH, as a smart-contract platform, can carry the flow value of economic activity itself. The market size it corresponds to is theoretically larger. As smart-contract applications continue to expand, ETH has an inherent logic for a rising market-cap share relative to BTC.

What is the ISM index, and why does Raoul Pal tie it to the ETH/BTC trend?

The ISM index (Institute for Supply Management’s Manufacturing PMI) is an important macro indicator for measuring global manufacturing activity. Rising readings mean the business cycle has entered an expansion phase, which is usually accompanied by improved liquidity. Pal believes ETH’s performance is positively correlated with the business cycle; rising ISM provides macro background support for the relative strength of risk assets, including ETH.

What is Raoul Pal’s basis for predicting the peak of the Bitcoin cycle?

Pal bases his view on the synchronization between Bitcoin and the global business cycle, as well as the effect of declining global liquidity lengthening the cycle duration. He believes Bitcoin is in a five-year supercycle rather than the traditional four-year cycle. He predicts that BTC could reach the peak of this cycle in the second quarter of 2026, but he emphasizes that this is an analysis judgment based on a macro-cycle model—not a certain prediction of a specific price.