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BitMine Chair Tom Lee Warns Bitcoin Could Face 50% Drawdowns Despite ETF Hype

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Bitcoin’s volatility isn’t gone, and it may nonetheless fall by as a lot as half its worth, in response to Tom Lee, chairman of BitMine.

Key Takeaways:

  • BitMine chair Tom Lee warned that Bitcoin may nonetheless see 50% drawdowns, regardless of rising institutional adoption.
  • Lee mentioned Bitcoin continues to reflect the inventory market, usually amplifying fairness market strikes by double.
  • While cautioning about volatility, Lee stays bullish long-term, predicting Bitcoin may attain $200,000–$250,000 this 12 months.

Speaking in an interview with Anthony Pompliano revealed Thursday, Lee mentioned he expects “50% drawdowns” to stay a part of Bitcoin’s value historical past, at the same time as institutional adoption grows.

Tom Lee Says Bitcoin Still Mirrors Stock Market, Warns of 40% Drops

His feedback come amid rising optimism that Bitcoin’s value swings have softened thanks to identify Bitcoin ETFs and elevated institutional participation.

However, Lee cautioned that Bitcoin continues to maneuver in tandem with conventional markets, and tends to amplify these strikes.

“The inventory market has extra frequent 25% drawdowns,” he mentioned. “So if the S&P is down 20%, Bitcoin might be down 40%.”

Lee added that whereas the broader economic system has matured lately, Bitcoin’s correlation with equities means sharp corrections are nonetheless probably.

Despite that, he stays long-term bullish. On the Bankless podcast earlier this month, Lee repeated his prediction that Bitcoin may climb to $200,000–$250,000 by the tip of the 12 months.

A 50% drop from these ranges would put Bitcoin again close to $125,000, roughly its present all-time high.

On the opposite hand, if Bitcoin has already peaked for this cycle, as some analysts who comply with the standard four-year cycle argue, a 50% decline from its present value of round $110,000 would push it all the way down to roughly $55,000, ranges not seen since September 2024, in response to CoinMarketCap information.

Veteran dealer Peter Brandt just lately issued an identical warning, evaluating Bitcoin’s chart to the soybean market of the Seventies, which crashed by half after a large rally.

Historical precedent helps the chance: after hitting $69,000 in November 2021, Bitcoin plunged practically 50% to $35,000 in simply three months.

Still, not everybody agrees with the bearish outlook. MicroStrategy’s Michael Saylor mentioned in June that the period of deep crypto winters is over: “Winter will not be coming again.”

Lee, in the meantime, believes Bitcoin could also be getting into a “longer cycle,” one that might reshape how traders take into consideration each its rallies and inevitable corrections.

Tom Lee Doubles Down on Ethereum as DAT Bubble Shows Signs of Bursting

As reported, Lee has reaffirmed his bullish stance on Ethereum (ETH), revealing a $1.5 billion buy following final weekend’s market crash.

Despite warning that digital asset treasuries (DATs) are buying and selling beneath their web asset worth (NAV), suggesting a possible bubble burst, Lee instructed Fortune he views the pullback as a long-term shopping for alternative.

Lee’s transfer was mirrored by BitMine Immersion Technologies, which collected 379,271 ETH price roughly $1.5 billion throughout three main purchases this week, in response to information from Arkham Intelligence.

The mining agency now holds over 3 million ETH, or 2.5% of the entire provide, making it one of many largest company holders of Ether.

BitMine reportedly goals to manage 5% of all ETH in circulation, positioning itself as a key participant within the Ethereum ecosystem.

Speaking with Cathie Wood, Lee in contrast Ethereum’s future to how Wall Street shifted from gold to equities after 1971, arguing that ETH may finally “flip Bitcoin” because the dominant retailer of worth.

The submit BitMine Chair Tom Lee Warns Bitcoin Could Face 50% Drawdowns Despite ETF Hype appeared first on Cryptonews.

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