Coinbase IPO To Affect Institutional Liquidity From Bitcoin, Raoul Pal Says

Coinbase IPO is making waves in the crypto space, and now, the macro guru Raoul Pal said that this could trigger some concerns.

The former Goldman Sachs manager Raoul Pal said that the IPO could impact Bitcoin and not in the best way.

Diverting institutional investors away from BTC

In a brand new tweet, Bitcoin bull said that the IPO of the US-based crypto exchange would divert institutional investments away from the crypto markets.

“Does anyone have a handle on when Coinbase IPO is? It’s going to suck a lot of institutional liquidity out of the space as it’s an equity that is easy to buy and will likely cause a short term, significant-top,” he said, as cited by the online publication the Daily Hodl. 

Pal explained that institutional investors would probably go on and choose to invest in a stock that offers exposure to cryptos rather than buy Bitcoin.

“Let’s say there is a $100 billion of institutional money ready to come into BTC in the next 6 months and XX billion retail. Crypto is impossible to buy for some and hard(ish) for others,” he said.

He continued and explained that “Then imagine an equity is launched that is worth $60 billion on the grey market. If you are a fund manager, then why not just own Coinbase to get exposure? Easy. No, it ain’t bitcoin, but it will move sort of like it, and you don’t have to beg your investment committee or trustees.”

Investing via broker

Pal also said that the retail investors could buy Coinbase’s stock via a broker than by going through all the hassle of owning and storing BTC.

He also pointed out to the fact that the rerouting of billions of dollars worth of investments could be the catalyst that starts a new BTC correction.

Analysts have been saying that we should expect a BTC correction these days and we’ll just have to wait and see what happens to the price of BTC.

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I am a technical writer, author and blogger since 2005. An industry watcher that stays on top of the latest features, extremely passionate about finance news and everything related to crypto.
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