Real Vision Founder Reflects on 13 Years in Crypto, Long-Term Value Outlook

Written by Raoul Pal, Founder of Real Vision

Compiled by Chopper, Foresight News

Now open your feed, and you’ll find the market sentiment is overwhelmingly bearish. The cycle is over, the crypto industry is dead, the four-year bull-bear pattern has been invalidated, and everyone who told you to buy was wrong. Price movements have deviated from public expectations; once prices move beyond comprehension, pessimism spreads. History always repeats itself.

I’ve witnessed this cycle countless times and know exactly how the story ends. After thirteen years in the crypto industry, I’ve made nearly every mistake possible. Before explaining my ongoing bullish thesis, let me share the pitfalls I’ve encountered—true wisdom always comes from failure.

In 2013, I entered when Bitcoin was priced at $200. But the timing of my purchase wasn’t the point. Before buying my first Bitcoin, I authored the world’s first macro valuation analysis of Bitcoin.

Compared to today’s standards, this valuation model is quite rudimentary. I drew inspiration from commodity valuation methods, tallying the total above-ground and below-ground reserves of gold, then applied this framework to Bitcoin. The conclusion was: if Bitcoin were to become digital gold, and gold prices remained at current levels, the value of a single Bitcoin could potentially reach $1 million.

This article quickly spread throughout Silicon Valley and the financial community, at a time when no one had yet built a macro-level valuation framework for Bitcoin. I didn’t just share my opinion—I recommended Bitcoin to all GMI subscribers, including multiple hedge funds and family offices. In 2013, recommending Bitcoin at $200 to these types of investors required tremendous courage.

My core conclusion at the time was: "Bitcoin is currently priced at $200, with a long-term target price potentially reaching $1 million. Considering I may likely be wrong, I proactively apply a 10% discount and set a ten-year target price of $100,000."

The final result was largely in line with expectations: Bitcoin indeed reached this level.

But seeing the destination and understanding the fluctuations along the way are entirely different things.

Looking back on this journey, I entered at an excellent price, watched it double, then triple, before crashing 84%. I reassured myself that this was a long-term bet and chose not to act. Then, in late 2017, the market surged again; one day, as I watched the chart, the price climbed to an unbelievable level, and I decided to sell.

Why? Fear, uncertainty, and doubt (FUD) are at play. Fork controversies abound, and the "bubble" narrative is everywhere, constantly whispering to you: seize a tenfold gain and cash out now, don’t let all your profits evaporate.

I exited my position. But after I sold, Bitcoin continued to rise tenfold.

I tried to act as if I wasn’t regretful, but I knew deep down I had made a huge mistake. Worse still, during the pandemic, crypto prices plunged again, and I re-entered the market, convinced I was cleverly buying the bottom. But that wasn’t the case: I sold at $2,000, only to buy back in at $8,000 to $9,000. Frequent trading, taking profits at highs, and repeatedly scalping around my position—all these actions prevented the only correct long-term strategy from working.

I once did a rough calculation: if I had held onto my initial $200,000 principal without touching it, its value today would be around $100 million. This demonstrates the power of compounding—and also proves how easily people make foolish decisions. The asset continued to appreciate on its own, while I repeatedly interrupted this process myself.

I missed out on massive unrealized gains, and this expensive lesson taught me one truth: adopt a longer-term perspective, ignore the noise, and hold long-term. For any brokerage, "dormant accounts" often yield the best returns, because holders don't impulsively trade their assets.

This is my reflection. Now let’s discuss the logic I’ve come to understand today but couldn’t fully grasp back then.

Over the past few weeks, I’ve been writing about currency depreciation, and all analyses ultimately lead here. Demographic trends generate debt, and debt drives continuous currency depreciation—cash loses about 8% of its purchasing power annually compared to long-term assets. To fully understand this chain of logic, read my previous article; in simple terms: holding cash is like holding a block of ice that’s constantly melting—the rational choice is to hold assets whose total supply cannot be artificially increased.

Bitcoin is the purest asset of this kind. Its total supply is permanently capped at 21 million, with no committee voting to increase issuance. It is the most hardened currency created by humanity, serving as a store of value—a digital vault.

But it’s crucial to understand that the vault has a growth ceiling. Bitcoin’s target market is global savings capital seeking a safe haven, roughly equivalent to the $35 trillion gold market, plus a portion of other assets used for wealth preservation. I believe Bitcoin will continue to capture an increasing share of this capital allocation. Its only real competitor is Zcash, a privacy-focused cryptocurrency that may capture up to 10% of the market, with the remainder going to Bitcoin.

So, the digital vault logic holds, and Bitcoin is a high-quality asset. But the vault is only half the story—or even just a small part of it.

Bitcoin is not programmable. By design, it excels at only one thing and does not take on any other functions. Smart contract blockchains operate in an entirely different category. There are many public blockchains on the market, but I continue to have strong confidence in three: Ethereum, Solana, and Sui. The most common mistake people make is grouping them together with Bitcoin under the broad label of “cryptocurrencies” and debating which one will ultimately prevail.

People overlook key facts—they are tasked with fundamentally different missions. Bitcoin addresses value storage, while smart contract platforms enable multi-party collaboration.

The framework of exponential growth I propose holds that artificial intelligence, robotics, energy, and cryptocurrency are simultaneously entering a period of explosive development. The future economy will no longer be driven by human labor, but rather dominated by machines. Billions of AI agents will conduct transactions continuously, purchasing computing power and settling transactions with each other at speeds far exceeding those of humans.

This raises an obvious question: what do they rely on to execute transactions? The traditional banking system is not suitable. The machine economy cannot tolerate three-day settlement cycles, reliance on correspondent banks, or settlement institutions that close on weekends. Intelligent agents require programmable, instant settlement, and 24/7 operational underlying channels — this is precisely the value of smart contract blockchains. They will become the settlement foundation of the machine economy in the age of exponential growth.

Therefore, building out this type of public blockchain is not about betting on a single token, but rather on the infrastructure upon which the next generation of economies will run. Tokens are not merely currency; they represent holders' stakes within the network and serve as the foundational layer of collaboration in the digital age.

This also means that Bitcoin valuation models should not be applied to public blockchains, nor should traditional corporate valuation methods be used. A public blockchain is not a company, but an economy. To assess the value of an economy, one must look at the total volume of economic activity occurring on it.

By comparing the target markets of these two major sectors, the core argument becomes clear. Bitcoin targets global savings, representing a market size of approximately $35 trillion—on par with gold and worth investing in. Smart contract platforms have the potential to handle settlement demands for global real estate (approximately $400 trillion), global debt (approximately $325 trillion), and global stock markets (approximately $125 trillion) in the future. This isn’t just a larger market—it’s an order of magnitude bigger.

The conclusion is obvious: over the long term, the combined market capitalization of high-quality smart contract blockchains will be several times that of Bitcoin. This does not mean Bitcoin will fail—it will perfectly fulfill its mission as a store of value. The reason is simple: an economy built atop a vault will naturally be larger than the vault itself. The vault holds savings, while the underlying network facilitates the entire economy’s circulation.

I can anticipate the mainstream bearish arguments in the market, and they deserve careful analysis rather than simple dismissal. This line of reasoning goes as follows: Bitcoin was fundamentally designed to preserve capital and accumulate value as a currency. Ethereum, Solana, and Sui are merely functional assets and financial infrastructure; infrastructure does not appreciate continuously like pure monetary assets. No matter how advanced the technology, it still doesn’t qualify as a high-quality investment.

But reverse engineering reveals the flaw. A pure store of value asset has an upper limit determined by the total size of savings seeking preservation—massive in scale, yet with a clear ceiling. The upper limit of infrastructure assets, however, depends on all the applications that can be built on top of them; every new project raises the ceiling further. Low fees do not equate to low value. The underlying network’s ability to scale and achieve widespread adoption relies precisely on low costs, and as a result, the network’s value continues to rise.

There is a clear distinction: lending protocols and exchanges built on Ethereum are commercial projects with revenue streams, competitive moats, and valuations based on cash flow. Ethereum itself is not a commercial project. Its value stems from the collective sum of all ecosystems built atop it. If Ethereum were to halt or disappear, it would not be just one company that vanishes — all layer-2 networks, most stablecoin markets, and the entire decentralized finance ecosystem would collapse instantly. This is its core value: Ethereum is the foundational base upon which all projects depend, not merely one among many.

Similarly, this explains why layer-2 networks struggle to replicate the value of layer-1 blockchains. Layer-2 networks rent security from the underlying main chain, with the majority of returns flowing back to the base layer. Even if a thriving layer-2 network emerges on Ethereum, it fundamentally continues to increase Ethereum’s value. Ultimately, all value accumulates at the underlying layer-1 blockchain.

Return to the market sentiment at the beginning of the article. If the long-term logic is so solid, why is the current market so agonizing? The broader environment of sustained liquidity ease and a more accommodative financial climate has already taken shape. What disrupted the market’s rhythm was the unexpected: the anticipated price rally never materialized. The market crash in October 2025 and the government shutdown triggered a series of disruptions that derailed the original market timing, delaying the rally’s start. Many investors interpreted this “delay” as a complete failure of the underlying logic.

The underlying logic has never collapsed. The gap between cryptocurrency asset prices and liquidity expectations has lasted longer than I anticipated, but this gap will only be repaired, not permanently closed.

Previously, the U.S. manufacturing PMI index remained below the breakeven line for an extended period, causing the business cycle to enter a downturn. The crypto industry, which heavily relies on market activity and investment sentiment, naturally requires a macroeconomic recovery. For a long time, the macro environment continued to face pressure. In addition, Bitcoin periodically exhibited liquidity discounts, decoupling from overall liquidity trends—a phenomenon that has occurred cyclically. Crypto asset volatility exceeds liquidity indicators: during market rallies, price gains surpass expectations, and during downturns, losses are equally exaggerated. Over the long term, the correlation coefficient between the two remains approximately 87%.

The market is currently in a dull phase, leading many to conclude that the long-term logic no longer holds—but this is not true. The business cycle has hit its bottom and is now rebounding. The manufacturing PMI index has remained in expansion territory for six consecutive months, with the latest July data recording 53.3. Historical patterns show that under such macroeconomic conditions, crypto markets often experience a recovery. During the upward phase of the cycle, investor risk appetite increases, leading to differentiation within the crypto market: junk bonds outperform government bonds, small-cap assets outperform large-cap leaders, and smart contract blockchains like Ethereum outperform Bitcoin. This occurs because economic activity boosts demand for block space, while savings demand drives Bitcoin’s performance.

I won’t provide a fixed portfolio or predict bottoms. Thirteen years of experience have taught me that no one can time the market precisely—forcing predictions often leads to repeating the tragedy of selling Bitcoin at $2,000.

The most important insight is the reflection at the beginning of the article. The crypto space is a long-term game that severely tests one’s mindset, as many people’s income and wealth are deeply tied to the industry. The ultimate winners are not those with the strongest short-term trading skills, but those who clearly understand the nature of their assets, believe in the ongoing adoption trend of the network, and can withstand periodic 50% drawdowns every few years.

Broaden your perspective and filter out market noise. Simultaneously position yourself in digital vaults (Bitcoin) and the foundational channels of the economy (high-quality smart contract blockchains), aligning with the industry’s growth curve—no need to expend energy trying to beat the cycle.