Fundstrat’s Tom Lee Compares Cryptoasset Growth to Major Tech Stocks

  • Fundstrat's Tom Lee says cryptocurrencies will become institutional and normal assets long-term.
  • Lee compares bitcoin's price to the network effect of FAANG stocks (Facebook, Amazon, Apple, Netflix, Google).

Fundstrat’s Thomas Lee has said that cryptoassets will become institutional long-term and follow the network effects that have been established by tech stocks such as Facebook, Amazon and Apple.

Lee, a managing partner and head of research at Fundstrat, argued in an interview with CNBC’s Street Signs Asia program that cryptocurrencies are “network value assets” and share similarities with popular FAANG stocks (Facebook, Amazon, Apple, Netflix, Google). 

When asked about his outlook for bitcoin, Lee said, 

Long-term very bullish. I think this is still the earliest days for digital assets. A lot of this overtime is going to be very institutional and become an asset class. I think once we hit that it’s actually another hockey stick.

Lee was asked about his $25,000 prediction for bitcoin by 2022, which he says is still “quite easy to achieve,”

Cryptocurrencies are network value assets, meaning the more people hold the asset, the greater the value. In fact, it’s a log function — so if you double the users hold it, you get a quadrupling of value. To go to $25,000 you essentially need a little less than 4x rise, which means you need to double the number of people who hold Bitcoin.

According to Lee, Fundstrat has estimated that roughly half a million people own and use bitcoin and that a $25,000 price target would require the number of users to double to one million. Lee sees the price of crytpo-assets continuing to grow based upon a network effect, similar to the FAANG tech stocks, 

70% of their return [since public listing] is explained by the growth of the global internet in that period of time. In other words, it’s a LOG function of the internet’s growth, and that’s how cryptocurrencies are going to work.

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Luxury Cars and $15 Million in Crypto Seized in Chinese Arbitrage Scam Bust

Michael LaVere
  • Chinese authorities seized $15M in crypto and several supercars following scam ring bust.
  • The group was allegedly operating an arbitrage scam that promised users fake Huobi Tokens. 

Chinese authorities have reportedly seized more than $15 million in crypto-assets and $2 million in supercars after busting up an arbitrage scam selling counterfeit tokens. 

According to a report by China’s Ministry of Public Security, police in the city of Wenzhou arrested 10 individuals connected to operating a fraudulent cryptocurrency scheme. The report claims the arbitrage group was scamming victims using blockchain smart contracts to generate fake cryptocurrencies. 

Following the bust, authorities seized bitcoin, ether, and tether worth over 100 million yuan ($15 million). The report also claims police seized several supercars, including a Ferrari and a McLaren valued at more than $2 million, in addition to the luxury villa in which the scammers were staying. 

The arrested individuals had reportedly operated a smart contract scheme since 2019, which advertised a blockchain product that claimed to generate Huobi’s native token HT. Unsuspecting consumers were promised the tokens would generate arbitrage opportunities worth a return of up to 8%. 

One victim, identified as Li in the report, first notified police after joining a Telegram group belonging to the scam artists. 

Li told authorities, 

Simply put, you send one unit of ETH to a designated address, you will receive 60 HT. And then you can sell it to gain the difference.

Featured Image Credit: Photo via Pixabay.com