Tom Lee has reviewed his former prediction that Bitcoin would reach $25,000 by the year 2022.
The latest prediction from the co-founder and strategist of Fundstrat is that bitcoin will hit $25,000 by the end of this year and $125,000 by 2022. This comes at an interesting time as bitcoin has had one of its worst weeks yet since 2015.
The currency hit an unexpected low close to $9,000 before its recovery to figures above $11,000 on Thursday. According to Lee, the $9,000 mark or something slightly lower than that will be the lowest price for the currency this year.
His advice to investors is to buy now before the coin recovers and shoots to unattainable levels. He terms this as the “biggest buying opportunity” this year.
A Bright Crypto Future
His prediction is not limited to bitcoin alone as he also envisions a bright future for ethereum and ethereum classic in the range of 90% by the end of the year to reach $1,900 and $60 respectively. He also says that NEO should grow by about 50% in 2018 to end the year at $225.
The recent loss of more than 50% off the bitcoin value from its December all-time peak came after reports on tighter regulations in South Korea and China on the crypto industry as a whole. This triggered a massive sell-off that affected quite a number of the top players on crypto charts. But prices have been steadying since Thursday on bitcoin as well as other key digital currencies.
Reasons for Optimism
Tom Lee’s speculations are based on calculations that take into consideration the growth of money supply, alternative currency ratios to the money supply and BTC’s share in those alternatives (e.g. gold).
In addition to the projections from those calculations, he also foresees a spike of interest from institutions investing into the space, usage and the growth of user accounts as factors likely to spur its upward momentum.
Lee, formerly the chief equity strategist in JP Morgan Chase, became the first strategist on Wall Street with a huge following to issue prediction reports on the price of bitcoin. He has been a part of Fundstrat Global Advisors since 2014 as co-founder and head of research.
When bitcoin experienced a major plunge to $10,400 on December 22 last year, he termed that a buying opportunity. That same day, he raised his mid-2018 prediction for the BTC price from $11,500 to $20,000.
A Lesson from the Past
The figures in his latest predictions might seem crazy but compared to the massive growth of the currency over 2017, they seem almost insignificant. In that single year, the coin gained more than 2,000% peaking at around $19,800 according to data from Coinbase.
On the other hand, ethereum experienced a 9,600% rise based on data from Coinmarketcap, to reach $770. Ripple was one of the biggest closers, growing by a massive 35,500% to end the year at $2.30.
Lee concludes that investors could enjoy bigger gains on other cryptocurrencies apart from bitcoin in 2018 if they make the most of tactical rotations into smaller coins. He says that the crypto ecosystem will almost double in size by the end of the year to reach a value of $1.2 trillion.