Despite losing 70% of its December 2017 peak value during what has been a wretched 2018 thus far, Fundstrat boss and undisputed No.1 Bitcoin Bull Tom Lee remains firm on his position that Bitcoin will explode by the end of the year, and finish 2018 on a high.
Tom Lee, co-founder of venture capitalist investment firm Fundstrat, says he never takes his eyes off the Bitcoin market, and despite what has been without doubt a shockingly bad first eight months of 2018, the no.1 ranked cryptocurrency will rebound and have a strong final third, and Lee firmly predicts that Bitcoin’s bullish phase will return by the end of this year.
In what Lee describes as a “Critical Correlation”, he believes that emerging tech markets as well as Bitcoin’s own market are ultimately and intimately connected. If the correlation he has seen continues, Lee believes Bitcoin prices could soon reach new highs.
Lee appeared on Monday’s edition of CNBC’s Trading Nation. When questioned on what he believes connects Bitcoin to these emerging markets, Lee commented:
“Both markets really reached new heights this year, and both markets fell into a bearish trend ever since. Until the emerging markets begin to change, I think in some ways the correlation will remain and tell us about the risk mentality of buyers who are not buying Bitcoin.”
Explosive End To 2018
Because of these factors, Lee can envision a scenario in which emerging markets would be the key to Bitcoin reversing its current negative trend. BTC would no longer have to rely solely on the slim possibility of the SEC granting fairer regulations, a dilemma other American FinTech companies have also had to overcome.
Also, it is worth noting that the iShares MSCI Emerging Markets Index ETF has itself declined in value by up to 8% so far in 2018 (although that figure is “small potatoes” in comparison with the devastating 70% of peak value Bitcoin has lost since December 2017, when BTC came within touching distance of a $20,000 price. By comparison, in 2018 Bitcoin has spent too much time hovering around the $6,500 mark (although at the time of writing it had edged above $7,000.)
Weaknesses in Bitcoin’s and the emerging markets’ public perception may have kept many investors away, but that situation could easily change.
According to Lee, if the Federal Reserve lowers its interest rate – as many believe it will soon do – and the dollar loses a little of its current high value, the opportunity will be there for corporate investors with enormous hedge funds taking over as the prime movers in both the emerging markets and cryptocurrencies, resulting in huge surges in value for both.
On Monday, during his chat on CNBC, Lee reaffirmed his prediction made months ago that Bitcoin could reach US $25,000 by the end of this year, stating:
“I still believe it is possible. Bitcoin could end the year explosively higher.”