Ethereum Supply Shock Incoming, ETH Could Surpass Bitcoin Soon: Raoul Pal


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According to macroeconomic expert raoul pal 

In 2022 he recognized that the crypto space began with a single blockchain-based asset. He saw the sector turning into a giant web of companies with massive amounts of capital flowing in the industry, which naturally has provided more conversational points of intersection with mainstream finance- as crypto continues on its upward path, gaining overall market cap and public attention. He acts as a bridge between crypto and traditional finance for mainstream people, helping them understand crypto and its potential impacts on the world- which could further crypto industry adoption.

The crypto space started with a solitary blockchain-based resource – BTC. Ensuing years saw the area transform into a giant web of parts with huge measures of capital streaming into the business, which normally has furnished more conversational places of convergence with standard money – making Pal an eminent wellspring of understanding, given his standard monetary ability and crypto information.

EntrepreneurCrypto and Blockchain Expert, the second-largest cryptocurrency by market value, Ethereum (ETH), could experience a series of supply shocks that might cause it to exceed Bitcoin (BTC).

Significant Supply Shocks Highlighted by Raoul Pal: 

Less Sell Pressure

In a recent video update, Real Vision CEO, Pal stated that the transition of ethereumto a proof-of-stake system, scheduled to take place in September, would probably eliminate a significant amount of sell pressure when major players withdraw their coins from the market and stake them for payout.

Miner Elimination

He also mentioned that there wouldn’t be any price drops by miners to cover their operating expenses, unlike with proof-of-work blockchains.

According to Pal, there shall soon be a supply cut of enormous proportions as miners will no longer be present.

Currently, a total of one or two billion dollars a month is not sold. However, after the sell-off, there shall be no constant pressure from miners who have received the Ethereum rewards.

ETH Staking 

According to most estimates, around 9% of all Ethereum is currently staked, which could potentially increase to around 30%.

He further clarified that in any scenario, though, a lot of money will be invested in staking. As a result, it becomes desirable in itself since if it stacks up to 30% of all ETH, that leaves 30% idle. This 30% cannot be utilized for anything, including rehypothecation, shorting, liquidity provision, or CeFi, because it is no longer in the system (centralized finance). This represents a major supply shock.

Deflation Risk post-merge

Additionally, Pal asserts that ETH could turn into a deflationary asset following the merger and likens its forthcoming tokenomics to a stock buyout that simultaneously raises demand and lowers supply.

ETH To OutPace BTC

According to the former Goldman Sachs executive, the charts confirm his suspicion that Ethereum will soon surpass Bitcoin in value. He claims that ETH/BTC is about to break out of a multi-year declining channel, making ethereuma considerably more appealing wager for the macro investor.

Because of the above factors, Pal thinks that market activities could get very interesting. It is very likely that because of the recent developments (as well as the ones to come) ETH could soon surpass Bitcoin in value and become the most valuable asset.