According to a recent note (seen by CoinDesk) published by FSInsight, a leading independent research firm, Bitcoin ($BTC) and Ethereum ($ETH) are headed quite a bit higher than many people in the crypto community seem to believe.
FSInsight serves “a broad array of clients around the world, including internationally recognized multitrillion dollar asset managers, hedge funds and private banks, representing some 80% of globally managed equity assets.” The firm is a wholly-owned subsidiary of independent research boutique Fundstrat Global Advisors. It was co-founded by “Thomas J. Lee, a top-ranked Wall Street analyst with some 30 years of research experience, and the former Chief Equity Strategist at global investment bank JPMorgan.”
On February 3, Sean Farrell, who is Head of Digital Asset Strategy at FSInsight, published a research note titled “Digital Assets in A Post-Cycle World”.
According to a report by CoinDesk and a report by Fortune that were both published on Monday (February 7), here are a few highlights from FSInsight’s note:
- Bitcoin’s correlation with stocks increased near the end of Q4 2021 and then its price went down after the Fed announced that it planned to tighten monetary policy and raise interest rates in 2022.
- Crypto is becoming increasingly correlated with tech stocks due to “legacy market capital entering the fold.” Farrell pointed out that “this is much different from 2018 where tech stocks were still doing well but Bitcoin sold off along with the rest of the crypto market cap.”
- Increasingly popularity of decentralized finance (DeFi) and non-fungible tokens (NFTs) has significantly increased the growth of the Ethereum network, thereby making $ETH “remarkably undervalued”.
- “All assets can sell off and drop another 50% if the Fed hikes 4% tomorrow or next month… But right now, as things stand, the upside to both Bitcoin and ETH is much larger than the downside.”
- In the second half of 2022, providing that Bitcoin manages to attract a new wave of investors, which Farrell believes has a “reasonable chance” of taking place, it could go as high as $200,000. As for Ethereum, he feels that it could reach $12,000.
According to data by CryptoCompare, currently (as of 21:55 UTC on February 8) Bitcoin and Ethereum are trading around $44,296 (up 0.46%) and $3,119 (down 1.08%) respectively.
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.
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