Seemingly perma-bullish Fundstrat analyst Tom Lee has taken to the Fox Business channel in the U.S. to chime in his opinion on Bitcoin’s status as a safe haven asset.
Unsurprisingly, Lee – who, (in)famously continued to make extremely optimistic forecasts for the pricing of Bitcoin throughout 2018 – was a strong backer of the narrative, which has continued to gain traction through this year . It’s a meme that began to rise in prevalence during Venezuela’s high-profile economic turmoil last year, and has further grown in influence during recent weeks, driven on by events in Argentina and unrest in Hong Kong. Lee said:
You can see it in markets where there's turmoil. The local Bitcoin prices tend to surge and are traded a premium because people are trying to find ways to protect their money.
CryptoGlobe reported on this ‘Premium’ phenomenon earlier this week , where data from LocalBitcoins showed that Hong Kong based traders were paying something in the region of $300 more for BTC as political unrest in the country continued into its 10th week.
The site reported a similar phenomenon amid the hyper-inflationary pressure of Venezuela's economic turmoil of 2018. H owever, similar circumstances for bitcoin buyers in Argentina have been attributed to chronic illiquidity in the BTC/ARS markets as much as the macroeconomic situation, however.
Pressed as to why bitcoin’s price was still relatively depressed compared to its all-time high when it is attractive as a safe haven, Lee defended BTC’s performance during the year. “In December , it was $3000, So it’s done very well this year.” he noted “It’s really uncorrelated to equities to bonds. So it’s a good diversification hedge. I think it’s just resting you know, it’s had a big move, and it’s consolidating, and this is a good chance to add more.”
Despite being mocked by show host Stuart Varney for his now-infamous $25,000 prediction for the price of Bitcoin at the end of 2018, Lee was happy to give an optimistic price forecast for the end of this year. Though he admitted he gets comments about it “every day”.
I think it's going to be much higher by the end of the year and potentially at a new all-time high. So I think anyone who wants to have a 2% or 1% allocation to Bitcoin as a hedge against a lot of things that could go wrong, it's a smart bet.
Lee went on to add that he’d “been in this business for 25 years and I always catch grief for everything that doesn’t go right.”
To offer Lee some defense, many of the predictions for the price of Bitcoin last year were made in the expectation of events that didn’t actually come to pass. Most notably the opening of Bakkt’s services in the U.S., which Lee believed would spark higher institutional interest in the cryptocurrency. Initially scheduled to open in mid-December 2018, Bakkt is still embroiled in the regulatory approval process and only began testing its on boarding systems in mid-July.