Macro Guru Raoul Pal Says Stablecoins Make Up 18% Of Crypto Market Cap: 'Essentially Short The Upside Call'

Raoul Pal, a former Goldman Sachs GS executive and macroeconomic expert, said the cryptocurrency industry holds around 18% of its assets in cash, provided that stablecoins are taken as a valid surrogate for "cash on the sidelines".

What Happened: Pal was referencing a graph created by Delphi Digital co-founder Kevin Kelly that illustrates how stablecoins have become a more prominent portion of the cryptocurrency market.

The Crypto market has a near-record weighting in cash (around 18%), if you assume stablecoins are a decent "cash on the sidelines" proxy.

The market is essentially short the upside call... great chart from @Kevin_Kelly_II pic.twitter.com/G3z8dmuGue

— Raoul Pal (@RaoulGMI) January 12, 2023

While stablecoins such as Tether USDT/USD and USD Coin USDC/USD have recovered after getting de-pegged from the U.S. dollar, the Terra (UST) crash caused considerable apprehension about stablecoins. 

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The macro guru in a tweet on Thursday said that the crypto market is “essentially short the upside call”, which means the market participants are not betting on an increase in price.

This comes as Bitcoin BTC/USD burst the $18,000 level on Wednesday and reached $19,000 by Thursday late evening. Ethereum ETH/USD on the other hand, reached the $1400 level.

The overall crypto market is in green with every major coin trading up. 

Price Action: At the time of writing, BTC was trading at $18,822, up 3.16%, in the last 24 hours, according to Benzinga Pro.

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