In sharp contrast to most analysts, Fundstrat’s Tom Lee says that cryptocurrencies are actually not speculative enough
While cryptocurrencies are frequently criticized for attracting speculators, Tom Lee of Fundstrat Global Advisors believes this is not the case. In fact, permabull believes that the crypto is actually not speculative enough, according to his remarks at the Bitcoin 2022 conference.
Fundstrat has estimated that oil trades 31 times on speculation, meaning that every barrel of oil is traded 31 times before it is actually used by refineries. Crypto, on the other hand, is speculated two and a half times per coin. As for the U.S. dollar, the level of speculation currently stands at 96 to 1.
Judging by these statistics, Lee concluded that the level of speculation in crypto is relatively low.
Bitcoin’s volatility is set to drop
Lee expects Bitcoin’s volatility to drop dramatically in the coming years as its market value continues to increase.
He drew parallels between the largest cryptocurrency and gold. Once the yellow metal reached the market capitalization of $10 trillion, its volatility dropped dramatically.
Bitcoin’s market cap still represents only a fraction of that of gold, but industry leaders of the likes of Galaxy Digital CEO Mike Novogratz believe that the flagship cryptocurrency could become the leading store of value in the coming years.
$200,000 is still on the table
In February, Lee predicted that the price of Bitcoin could reach $200,000, arguing that a lot of speculative capital could end up flowing into the crypto.
Last year, the Fundstrat boss forecasted that Bitcoin could hit $125,000, but the top crypto only peaked at $69,000.
Lee is no stranger to failed Bitcoin price predictions. In 2018, he claimed that the price would reach $25,000 before a massive correction.
