Raoul Pal, the head of Real Vision, claims that the current cryptocurrency cycle is developing in a similar scenario to 2017, when Bitcoin showed steady growth throughout the year before the December rally. His forecasts, based on macroeconomic data, suggest that the current cycle could last until the second quarter of 2026.
Macroeconomic factors determine the length of the cycle
'This is eerily similar to 2017,' Pal said. The analyst predicts a longer cryptocurrency cycle, as the business cycle indicator — a macroeconomic model he uses to track the position of the global economy in a broader cycle — 'is still below 50', and it usually 'takes time to rise.'
In 2017, Bitcoin started at $1,044, reached $2,187 by May 31, and finished the year at $14,156, which was approximately a 1,255% increase from the starting price of the year.
Bitcoin's growth in 2017
Pal suggests that the weakening of the U.S. dollar indicates that the current bull cycle is still far from its peak. 'The ongoing decline of the dollar suggests that the cycle could stretch until the second quarter of 2026,' he noted.
Inverse correlation of the dollar and Bitcoin
Since January 1, the U.S. Dollar Index (DXY) has decreased by 8.99% and is at 98.77 at the time of publication, according to TradingView data. Bitcoin and DXY have an inverse correlation — when the dollar weakens, Bitcoin becomes more attractive not only as a speculative investment but also as an alternative currency.
1-week chart of the U.S. Dollar Index (DXY)
Pal believes that macroeconomic data has become the main catalyst pushing the cryptocurrency cycle to a later period. 'It seems the entire cycle has shifted, as interest rates have not been adjusted; the dollar has been moving sideways for some time,' he explained.
The analyst also suggested that the current market conditions may resemble 2020 more than 2021, indicating that the market might be in an earlier growth phase than many assume. In 2020, Bitcoin started at $7,174, fell 27% to $5,227 by March, then recovered 129% to $11,990 in August and finished the year at $28,993 — a growth of 304% from the initial price.
The Middle East is betting on AI and blockchain
To continue expanding, the market needs to attract 'larger players.' Pal spoke about a recent trip to the Middle East, where he met with sovereign wealth funds and noted that most of them are optimistic about cryptocurrencies.
'The mandate across the region — from Saudi Arabia to Abu Dhabi, Dubai, Bahrain, and Qatar — is artificial intelligence and blockchain,' he emphasized. According to Pal, it's not just about using Bitcoin as a reserve asset but also about building the entire state infrastructure on blockchain.
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