When Fundstrat Tom Lee published its first Bitcoin report about five years ago, it said that by 2022, cryptocurrency could cost between $ 15,000 and $ 50,000.
bitcoin is now somewhere in the upper middle of this range, and Lee is still optimistic about the future of bitcoin and crypto, especially as exchange rates rise.
“Interest rates look as if they are set to reverse a nearly 30-year decline,” said the founder of Fundstrat CNBC. Cryptoworld Monday. “This means that over the next 10 years you are guaranteed to lose money by owning bonds… that’s almost $ 60 trillion out of $ 142 trillion [of U.S. household net worth]».
Technology stocks and other risky asset growth have been hampered by sharp rates this year and continue to fall amid investor concerns over the Federal Reserve’s planned rate hike. Goldman Sachs is seven rate increases are now projected this year.
“The question we ask ourselves is, ‘Where will $ 60 trillion go to make a profit?'” Lee added. stocks … it will really trace its roots to the rotation of bonds and eventually flow into the crypt ”.
Crypto as an alternative asset class has grown and diversified beyond bitcoin over the past two years, including decentralized finance, NFT and stablecoins, and other altcoins. However, these new assets still need to prove a lot to gain legitimacy and give investors confidence as in bitcoins.
Investors have become so accustomed to bitcoins that they are no longer just cryptocurrency types that hold on to expensive lives, or “HODLing,” they are also short-term traders who treat bitcoin like any other risky asset.
Although there is plenty of room for experimentation, testing, training and possibly failures when it comes to NFT, the metaverse and other new uses in cryptocurrencies, it is necessary to maintain the security of the Bitcoin network, Lee said. That could be the biggest hurdle for an asset up to $ 100,000 and above, he believes.
“The biggest drawback for the crypt will be the vulnerability found in bitcoins, because it is the most important blockchain and the one with the greatest value,” he said.
Crypto has come a long way in the last five years, but it is still a young asset whose uses are still being identified and testers are being tested.
“If someone really doesn’t have a crystal ball, it’s very difficult for a crypt to be accurate,” Lee said. “40% drawdowns are really common, and bitcoin makes most of its profits in 10 days in any year. It’s hard to be too accurate with crypto. It’s broad bands.”