Real Vision CEO Raoul Pal is encouraging investors to look at crypto projects as assets instead of just technological advances.
The former Goldman Sachs executive recently wrote a blog post in which he suggested that crypto ecosystems can be seen as networks which generate both intrinsic and extrinsic value.
The Bitcoin network (BTC) was designed to be an independent monetary system, free from manipulation by governments.
“It is fiercely protective of the integrity of its protocol (how its society functions) and as a result, shuns innovation in the name of purity. Think of the Bitcoin economy as the Catholic Church during the Dark Ages or the gold bug community. There can only be one God or one asset. In the case of the Bitcoin economy, the only asset that exists is Bitcoin. So, if you wish to allocate capital to this economy, your only choice is to HODL [hold on for dear life] Bitcoin.”
Pal argues that the Ethereum network (ETH) is more analogous to the complex US economy.
“In this system, you can start out by buying ETH which has a deflationary supply, meaning there will be less of it as time goes by. Because of this, its ‘central bank’ (the staking) adheres to responsible monetary policy designed to ensure that value is upheld and not debased.”
The Real Vision CEO believes the Ethereum economy’s greater complexity will make it bigger than the Bitcoin Economy in the long run.
Pal also compares the XRP and Solana (SOL) ecosystems to national economies.
“For example, XRP could be compared to the UK: it is an old economy, which, although important and well-established, doesn’t grow fast due to a lack innovation.
Solana might be South Korea just after the Asian Crisis when its currency and equity markets crashed. It presented unmatched opportunity, which outperformed the USD and SPX over six years. However, it was not able to sustain the high performance. We will see how Solana plays out.”
He concludes by studying the total market capitalization for crypto assets, noting that it is currently in a “perfect setup” between two long term support levels.
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