Bitcoin bull Tom Lee claims he has not wavered from his previous $25,000 forecast for bitcoin by year’s end, even though he mentioned a price slightly surpassing $20,000 in a recent CNBC interview.
Lee, co-founder of Fundstrat Global Advisors and the best known Wall Street analyst who forecasts bitcoin prices, quickly clarified Thursday evening in a CNBC “Fast Money” interview that he maintains his $25,000 forecast.
Lee initially stated on Squawk Box Thursday morning that bitcoin has traded at 2.5 times its mining cost. The mining cost is $7,000 and rising, he said, meaning by year’s end the mining cost will reach $9,000.
Lee Corrects Himself
By Thursday afternoon, Lee said the estimated mining cost indicates a price over $20,000 – around – $22,000, then added that the $25,000 price can be reached by year’s end “or something like that.”
A few thousand dollars is not something that investors should quibble over since any price beyond $20,000 will be around 200% above current levels, Le said. The price was around $6,600 on Friday morning.
The $6,600 price range returns bitcoin to its April range, where it fell from close to $20,000 late last year. The price peaked at $9,800 in May, and has since lost around 30%.
Lee, who was chief equity strategist J.P. Morgan from 2007 to 2014, said bitcoin and blockchain represent a “multidecade story” that is still in its early stages.
Lee said he performed wireless research in the 1990s and witnessed mobile and Internet convergence over 20 years. Bitcoin’s current situation is “not that different” for the way an industry changes over time, he said.
Lee’s Forecast Falters
Lee said in late May the fact that blockchain innovation was not slowing, coupled with a market “sanity check,” should have triggered market gains, even though the broader cryptocurrency market lost around 10%.
Some of Lee’s prior predictions have proven correct, such as his prediction that tax selling pressure would affect bitcoin’s price in the first quarter.
Lee may not have considered the reluctance of institutional investors on account of regulatory uncertainty about bitcoin. He acknowledged at the time that it will take time for developments such as improved custodial support and regulatory clarity before institutional investors will enter the market.