Author: Martin Young, CoinTelegraph; Compiled by: Tao Zhu, Jinse Finance
Real Vision co-founder and CEO Raoul Pal stated that the cryptocurrency market is entering the 'banana singularity' zone, or a period where 'everything is rising.'
"Banana zone" is a term created by Pal to describe periods of significant price increases.
"Yes, we are still in the banana zone," macro investor Raoul Pal stated on X on January 10, adding that the first phase of this bull market was the breakout in November last year.
Pal said that the current consolidation phase follows closely—similar to the 2016/2017 cycle—and added, 'This won't last long.'
Looking ahead, Pal stated that the next phase of the 'banana zone' is the 'banana singularity'—a season of altcoins where 'everything is rising, followed by larger consolidation.'
Altcoin season usually comes after Bitcoin's dominance declines. According to TradingView data, this ratio is still as high as 58%.
In another post on January 10, DeFi researcher '0xNobler' seemed to agree with Pal's view, telling his 225,000 X fans, 'Bitcoin has just entered an acceleration phase,' and predicted that Bitcoin will soar to $500,000, which would 'ignite the largest altcoin season in history.'
However, futures trader 'CoinMamba' was more pessimistic: "This sell-off is too bad. As long as prices return to a week ago's levels, we will welcome altcoin season."
Meanwhile, Pal indicated that the third phase of the banana zone is 'core winners erupting, hitting higher highs or a 'consolidation stage.'
Raoul Pal predicts the 'second phase of the banana zone.' Source: Raoul Pal
Despite market adjustments this week, the total market capitalization of cryptocurrencies has grown 90% year-on-year, climbing from about $1.8 trillion to the current $3.4 trillion after spending most of 2024 in a consolidation phase.
Additionally, total market capitalization reached a historic high of $3.9 trillion on December 17, 27% higher than the peak of the previous cycle.
Total capitalization of the cryptocurrency market within a year. Source: CoinGecko
Last year, Raoul Pal correctly predicted that the cryptocurrency market would rise in September, after breaking out of consolidation.
"With the increase in global liquidity, cryptocurrencies will rise, and other markets like Nasdaq will also rise," he stated at the time.
In another article on January 10, Pal shared a chart depicting the correlation between Bitcoin and the global M2 money supply, showing similarities to the 2016/2017 cycle, during which Bitcoin first fell and then rose.
"Everything will be okay. It might be a bit lower, or it might be done. Either way, it will go up over time."
Global Macro Investor (GMI) research director Julien Bittel also predicted that Bitcoin would enter the banana zone. He stated in June, 'Basically, this is the quiet zone before the banana zone,' after BTC experienced four months of sideways trading in 2024.
Since the market broke out of consolidation in early November, it has been in the 'banana zone', accelerated by Donald Trump's presidential election victory.
As of the time of this article, BTC is still in a pullback, down 1.3% on the day, trading at $93,370, a drop of about 9% from its weekly high of just over $102,000 on January 7.
