According to Fundstrat Global Advisors co-founder Tom Lee, the first major Wall Street strategist covering Bitcoin, the recent cryptocurrency price pullback just gave investors another opportunity to buy the flagship cryptocurrency, as he sees it reaching $20,000 by mid-2018.
“Revising mid-2018 Target to $20,000 from $11,500” – @fundstrat
— Blockchain Sam Ro (@bySamRo) December 22, 2017
Lee started endorsing Bitcoin’s rise when it was still below the $5,000 mark. According to him, last week’s correction that saw Bitcoin drop from its all-time high of over $19,000 to $13,600 was healthy for the cryptocurrency, so much so he raised his mid-2018 price target up from $11,500.
At press time one BTC is currently trading for $15,800, and Lee estimates the cryptocurrency’s fair value to be of $19,103, 21 % above its current levels. In a note, he said:
“We are revising our mid-2018 target to reflect the surge in activity in the past few months — that is, the base of users is up.”
The strategist’s price target takes into account a projected unique IP Bitcoin wallet address increase of 50% by mid-2018, with user activity rising by 10% from its current levels. Notably, back in August, Lee’s original prediction was for the flagship cryptocurrency to hit $6,000 by mid-2018, but he has since raised it twice now.
Per Fundstrat, the number of wallets and transaction activity per wallet help us explain “about 93% of Bitcoin’s rise” since 2013. Lee dismisses the idea of a speculative bubble driving Bitcoin’s value up and says that those who claim a bubble is inflating Bitcoin haven’t done their homework. He said:
“If someone says Bitcoin’s a bubble, it’s the smallest, least held bubble I’ve ever met (…) I don’t know very many institutions that own Bitcoin. So how can something be deemed a bubble that’s only held by a few?”
Bullish on Bitcoin
Bitcoin has risen over 1,900% this year, even if we take into account last week’s steep decline. Despite bubble rumors, investors and strategists are seemingly more bullish on Bitcoin than ever. As recently covered by Core Media, BlockTower Capital reportedly bet $1 Million on the cryptocurrency hitting $50,000 by the end of next year.
To Lee, Bitcoin will hit $25,000 by 2022, which spells bad news for BlockTower capital’s bet. Per his analysis, $11,000 is becoming a support price for BTC, followed by other support levels at the $10,131, $7,918, and roughly $7,000 marks.
John McAfee, the cybersecurity pioneer, and eclectic personality is also bullish, seeing BTC’s price hit $1 million by 2020. In the past, McAfee predicted the cryptocurrency’s new all-time high, a mere 24 hours before it occurred.