Bitcoin Bull Tom Lee Sticking to his $25k Prediction

Avi Rosten
  • The well-known bitcoin bull is still standing by his predictions for BTC, seeing the coin hit $25k in 2018
  • Identifying several factors that will push the price up - Lee sees increasing institutional investmtent as crucial

Tom Lee, Co-founder and Managing Partner of Fundstrat Global Advisors is doubling down on his bullish bitcoin predictions for 2018 despite the recent slump.

In an email to CNBC, the well-known bitcoin bull said that despite the cryptocurrency recently losing nearly all of the gains it has made since mid-April, he still sees the coin hitting his previously predicted high of $25,000 for 2018.

BTC today dropped below the $8,000 mark for the first time in over a month and is trading at the time of writing at $7529 according to CryptoCompare - a 41% drop for the year.

Lee however, attributes this latest drop purely to “typical crypto volatility” and identified several factors that he sees pushing the coin up to new highs in 2018.

The biggest factor in his opinion is the increasing involvement of institutional investors in the crypto space.

Talking to CNBC’s “Futures Now” yesterday, Lee commented:

"I think institutional investors have gained a lot of interest, and they haven't really come into crypto yet because there is still some regulatory uncertainty. But that sort of ultimate allocation into crypto as an asset class is going to be a powerful reason why bitcoin rallies."

Tom Lee

Moreover, historical data from Fundstrat he says corroborate his optimistic outlook:

"Historically, 10 days comprise all the performance in any single year of bitcoin's price," he said. "If you just took out those 10 days, bitcoin's down 25 percent a year. So as miserable as it feels holding bitcoin at $8,000, the move from $8,000 to $25,000 will happen in a handful of days."

Tom Lee

While Lee’s latest remarks were confidently bullish, the influential figure made a notable error of judgement recently when he incorrectly predicted a 70% surge for bitcoin around the Consensus Conference of last week - a mistake he later attributed to a greater need for regulatory clarity.

HODL: Tom Lee Reaffirms BTC's Full-Year Gains Are Generated in Only 10 Days

Francisco Memoria

Tom Lee, the head of research at Fundstrat Global Advisors and a well-known bitcoin bull, has recently reaffirmed that his research has shown bitcoins’s full-year returns are generated in only 10 days, hinting that HODLing makes sense.

On social media, Lee referenced this week’s crypto market rally, Lee noted that it can serve as a reminder that bitcoin, the flagship cryptocurrency, has historically generated its annual gains in 10 days.

Lee’s research was initially revealed last year, and it showed that, since 2013, the flagship cryptocurrency needed only 10 days or less to see its full-year returns. At the time, Lee used 2017 as an example, noting then “a total of 12 days” represented the cryptocurrency’s full-year return.

According to the Wall Street analyst, if an investor didn’t hold on to stocks through the 10 best days for the S&P 500 each year, his annualized return would drop from 9.2% to 5.4%. Comparatively, if an investor doesn’t hold BTC for its top 10 days, his annualized return would drop to -25%.

Lee’s recent tweet came as a reminder the HODLing makes sense for those investing in BTC. In the last few days the flagship cryptocurrency has been seeing its price rise significantly, so much so it’s up 41.3% in the last 30 days, according to CryptoCompare data.

What’s behind BTC’s price surge is unclear, although some analysts believe various factors could be involved. The cryptocurrency last month saw a ‘golden cross’, and Fidelity Investments is reportedly going to “buy and sell” the crypto for institutional clients in the next few weeks, showing technicals are improving, as well as adoption.

Tom Lee is a notable bitcoin bull as he’s made various bullish predictions regarding the cryptocurrency’s future price. Last year, he predicted it would hit $25,000 by the end of 2018, and that it would hit $91,000 by March of 2020.