Fundstrat’s Tom Lee Predicts Bitcoin, Ethereum Surge Once Metals Rally Fades

Fundstrat managing accomplice Tom Lee believes Bitcoin and Ether are poised to play catch-up as soon as the blistering rally in gold and silver begins to chill, arguing that crypto fundamentals stay intact regardless of latest underperformance.

Speaking on CNBC’s Power Lunch on Monday, Lee stated digital property ought to usually profit from a weaker US greenback and a Federal Reserve that’s transferring nearer to easing.

However, he famous that crypto markets have lacked a key driver this cycle as leverage throughout the business has been largely worn out.

Tom Lee: Gold and Silver FOMO Is Holding Back Crypto

“Crypto doesn’t have the leverage tailwind as a result of the business delevered,” Lee stated, including that so long as gold and silver proceed to surge, traders are chasing metals as an alternative.

“There’s a FOMO into shopping for that as an alternative of crypto,” he stated. Historically, Lee argued, durations the place treasured metals pause have typically been adopted by sharp rallies in Bitcoin and Ethereum.

The divergence has been stark in latest weeks. Gold costs hit a document high of $5,100 on Monday, extending positive factors to roughly 17.5% for the reason that begin of the 12 months.

Silver has moved much more aggressively, climbing 57% year-to-date to peak at $110.

Analysts have linked the surge in treasured metals to heightened geopolitical tensions, commerce tariff threats and sustained weak point within the US greenback, all of which have pushed traders towards conventional protected havens.

Lee stated crypto markets are nonetheless coping with the fallout from a significant deleveraging event on Oct. 10, which he described as having “crippled many key gamers” throughout exchanges and market makers.

While the sector is “limping alongside,” he stated the underlying fundamentals have improved meaningfully since then.

Bitcoin has struggled to replicate these fundamentals. The largest cryptocurrency is down roughly 30% from its October high and has didn’t regain momentum above the $95,000 degree, lately sliding again towards assist close to $86,000.

“The treasured steel transfer has sucked quite a lot of the oxygen out of the room,” Lee stated, including that costs are lagging fundamentals relatively than signaling deeper weak point.

Tom Lee-Linked Firm Buys $58M in Ether as Institutional Interest Grows

Lee’s confidence in Ethereum stays evident. On Monday, BitMine, an Ether-focused treasury agency linked to Lee, purchased another 20,000 ETH for $58 million, in accordance with blockchain analytics agency Lookonchain.

Lee additionally stated latest discussions on the Davos discussion board underscored rising curiosity from monetary establishments in constructing on Ethereum and different good contract platforms.

Not all analysts agree that greenback weak point alone will carry Bitcoin. CryptoQuant analyst GugaOnChain stated recent ETF outflows show traders nonetheless favor gold in periods of stress.

“For BTC to thrive,” they stated, “the weak point of the American foreign money should come from threat urge for food, not from worry.”

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