Raoul Pal: Global Liquidity Explains 89% of Bitcoin’s Price—Narratives Are Just Noise
Raoul Pal, founder of Global Macro Investor, has reignited debate around Bitcoin's true price drivers, sharing a chart that shows a near-perfect correlation between BTC price and global liquidity trends.
According to Pal, 89% of Bitcoin’s movements can be explained by Global M2—a broad measure of money supply—leading BTC by roughly 12 weeks.
In the chart, the trajectory of Bitcoin (plotted in pink) follows the path of Global M2 (black line) with a consistent lag.
The implication is clear: monetary expansion, not headlines or short-term narratives, is what really fuels Bitcoin’s long-term performance.
“If 89% of all BTC’s price action is explained by Global Liquidity,” Pal writes, “then by definition almost all ‘news’ and ‘narrative’ is noise.”
This thesis supports the idea that Bitcoin acts as a macro asset—responding to debasement and liquidity cycles—rather than a purely speculative or event-driven one. As global liquidity continues to rise in 2025, Pal’s model suggests BTC may still have significant upside ahead.
Kosta Gushterov
Reporter at Coindoo
Kosta joined the team in 2021 and quickly established himself with his thirst for knowledge, incredible dedication, and analytical thinking. He not only covers a wide range of current topics, but also writes excellent reviews, PR articles, and educational materials. His articles are also quoted by other news agencies.
