Fundstrat analyst and executive Tom Lee thinks Bitcoin’s incredible bull run is just beginning.
In a new interview with CNBC, the firm’s managing partner and head of research says the weakening dollar will contribute to Bitcoin’s continuing price climb.
“First, Bitcoin’s got to be denominated in something. So if the dollar’s weakening, [and] Bitcoin holds its value, then Bitcoin goes up. But the more important effect is this year we did see a lot of central bank liquidity. The dollar was really strong, surprisingly, for much of the year, but its weakness now is going to make people think, ‘How do you keep a unit in sound money?’ A lot of people thought gold would be that store, and I think it still has a reasonable basis for someone to be long gold, but I think for younger folks and those who are in the digital generation, Bitcoin is that digital asset that they want to hold as a store of value.”
Lee predicts that Bitcoin’s 2021 will outperform its bull run in 2020, meaning “something above 300%” on the year.
When asked about Bitcoin’s correlation to equities, Lee cautions that BTC is likely to lose value if the stock market corrects.
“We have to keep in mind Bitcoin’s holder base is still tiny. I don’t think there are even more than a million real people that own Bitcoin, compared to nearly a billion people that own other financial instruments. So it’s tiny – the penetration is one one-thousandth of where it should be…
I think if we have a correction in stocks then Bitcoin’s going to fall, and it’s because a lot of the incremental buyers – if they’re in the US – may be using leverage or risk-on or risk appetite as a reason to add to Bitcoin, so it should actually be falling as stocks fall.”Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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