Raoul Pal, CEO of Real Vision and former Goldman Sachs hedge fund manager, recently said volatility can be a positive for cryptocurrencies
Former Goldman Sachs hedge fund manager Raoul Pal described volatility as an ally for crypto traders. Pal argued that Bitcoin’s price swings are not as harmful as many assume. He added that a large number of crypto investors view Bitcoin’s volatility optimistically, and he believes that volatility has helped Bitcoin gain value over time.
Pal, the head of the financial media platform Real Vision, urged potential investors not to be deterred by volatility. Speaking at a virtual conference hosted by MarketWatch, he encouraged crypto investors to regard volatility as a constructive factor.
“It is a feature that determines risk and return,” he said. “Without that volatility, you couldn’t achieve annual returns of 230%. In this instance, volatility is your friend.”
Bitcoin has experienced exponential growth since the first block was mined over a decade ago. Its all‑time high has changed several times during that period and most recently reached about $62,000 last month. The leading cryptocurrency entered an upward trend on Saturday, briefly trading near $61,300 before pulling back toward $60,000.
Pal believes volatility has been central to reaching those levels. He acknowledged both sides of volatility in his remarks, noting, “Volatility is heavily skewed to the upside, [but] that doesn’t mean you won’t experience sharp downward shocks and large moves.”
His comments come less than two weeks after U.S. investment bank JP Morgan reported that Bitcoin’s price volatility had trended lower. The bank observed that many institutional investors had been attracted to the asset as volatility declined. According to JP Morgan, these investors are looking for assets with low correlation to help them diversify portfolios more effectively.
Pal’s view differs from JP Morgan’s assessment. He believes investors are drawn to Bitcoin because of the potential high rewards volatility offers, and he urged that investors should not be frightened off by the cryptocurrency’s swings.
He also briefly addressed regulation in the crypto sector, pointing out that many crypto users dislike strict rules. Pal suggested he favors light-touch regulation that encourages innovation and attracts capital to the sector while minimizing harm.