After weeks of stability, in the past week alone, Bitcoin (BTC) has collapsed under $4,500 in a surprising bout of selling pressure. So, many have claimed that the crypto market has been struggling, and that’s even putting it lightly.
However, in a testament to the strength (and stubbornness) this industry’s proponents, Tom Lee of Fundstrat has remained cautiously optimistic, calling for BTC to hit $15,000 by 2018’s end.
Bitcoin Bull Cuts Price Target, Still Bullish Though
As reported by Live Coin Watch previously, in late-September, Fundstrat’s Head Of Research, Tom Lee, maintained his belief that BTC was poised to surpass $22,000, while Ether had the potential to surmount $1,900.
But, after the recent resurgence of bears, which saw the aggregate cryptocurrency market capitalization take a $75 billion haircut (33%), Lee’s inner bulls have receded from the limelight.
Lee, a long-time Bitcoin proponent, recently took to CNBC’s Squawk Box to explain his change of heart.
A Change Of Heart… Somewhat
Touching on equity markets’ strong sell-off, Lee explained that “liquidity has dried up” in stock markets, subsequently catalyzing weak performance in the cryptosphere. More specifically, the Fundstrat executive pointed to the fact that BTC isn’t a “value asset,” meaning that investors, from the crypto- and equity-focused varieties, will be hesitant to purchase bitcoin amid tumultuous market conditions.
Lee, alluding to why this nascent market experienced an influx of volatility, then noted that BTC should be seen as an “emerging market” or “commodity.”
The CNBC host, doing his best to determine if Bitcoin’s recent leg lower was catalyzed by trader psychology or fundamental factors, like Bitcoin Cash’s hard fork, queried Lee about this recent downturn and the possible reversal.
Interestingly, the Fundstrat in-house crypto savant explained that FANG (tech stock)’s recent move lower has undoubtedly hurt bitcoin holders to their very core. But, somewhat contradicting his own point, Lee pointed out that institutional adoption is in crypto’s cards, before adding that this downturn is just an “awkward transition.”
Still, it was noted that the arrival of institutional-centric products and platforms, like Fidelity’s Digital Asset Services and Bakkt, coupled with growing regulatory clarity will eventually entice hotshot investors to enter the Bitcoin space. Not only will institutional players eventually foray into cryptocurrencies, but individuals across the globe, as this nascent innovation evidently has value in a digital world where consumers crave freedom.
And, of course, touching on his favorite indicator to-date, Lee, concluding his comments, touted that Bitcoin’s break-even cost of mining remains at $7,000, which may not be all too accurate.
Regardless, keeping this sentiment in mind, which consisted of a healthy mix of negative and positive fundamental factors, Lee doubled-down on his recently-changed price prediction, calling for BTC to hit $15,000 by year’s end.
The aforementioned sentiment aside, Lee stated that the sell-off that cryptocurrencies are undergoing is “a negative development,” as momentum indicators are only pointing lower.