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 has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work at Coindoo has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.
