Bitcoin May Outperform Nasdaq 100 as Raoul Pal Predicts Fiscal Dominance Impact

Raoul Pal, founder of Real Vision, has suggested that Bitcoin (BTC) may deliver stronger performance than the Nasdaq 100 in the coming months. His analysis hinges on rising interest rates increasing government debt refinancing burdens, which could lead to long-term liquidity expansion.

Pal posted on X on September 18: "My view for a couple of months is that BTC outperforms the NDX going forwards as fiscal dominance and the need to refinance meets The Everything Code." Bitcoin.com reported that Pal argues rising interest rates and government debt refinancing—referred to as 'The Everything Code'—may require more liquidity.

Typically, higher interest rates increase discount rates for risk assets and borrowing costs, which can weigh on Bitcoin. However, Pal believes that as government debt grows, the need to cover high interest payments and refinancing costs may drive long-term liquidity expansion.

The Federal Reserve raised its benchmark rate by 25 basis points on September 16, setting it at 3.75%-4.00%, with a unanimous 12-0 vote. The Fed stated this move supports its dual mandate and aims to bring inflation back to the 2% target. This was the first rate hike since July 2023.

Bitcoin.com reported that Bitcoin rose above $81,000 on September 18 after trading around $75,580 before the Fed decision. On the same day, Nasdaq 100 closed at 29,644.17, up 0.67%. However, comparing daily prices alone is insufficient to determine relative strength due to differing units and trading structures between the assets.

Pal's concept of 'fiscal dominance' refers to a scenario where government fiscal pressures significantly influence monetary policy and liquidity decisions. While Pal argues Bitcoin and Nasdaq 100 both track global liquidity, his specific correlation metrics are not publicly verifiable. Bitcoin.com also noted that Pal previously forecasted a $450,000 Bitcoin price by late 2026—a personal projection not part of this recent post.

Market participants have mixed reactions to the Fed's rate hike followed by Bitcoin's rise, with some noting it as interesting but cautioning against premature bullish conclusions. Pal's analysis remains a personal economic interpretation rather than an official policy statement.