November 21, 2018 | AtoZ Markets
Despite Bitcoin price crash this year, Wallstreet Cryto bull, Tom Lee insists on a bullish year. He cuts his 2018 target from $25000 to $15000.
Wallstreet’s popular cryptocurrency bull, Tom Lee, is insistent that the Cryptocurrency market would end bullish by the end of the year. Last week, when Bitcoin price broke below the $6000 mark, the co-founder of Fundstrat Global Advisors lowered his end-of-year prediction from $25000 to $15000.
Lee’s Bitcoin Estimate Based on Mining Costs
Lee’s estimate was primarily based on the average cost of mining in relation to Bitcoin price. According to him, mining cost should match the price of Bitcoin. He explained that for miners to ‘breakeven’ Bitcoin should be valued at $7000 to cover the costs of mining on Bitmain’s S9 mining machine. Based on his estimates, the value of Bitcoin should be equal to 2.2 times the ‘breakeven’ price ($7000) which is roughly $15000. He believes, price would be attracted to his estimate by the year end.
Lee betting on $15000
Despite the price slump which has seen most Cryptocurrencies dipped by a double digit downward swing, Lee has reiterated on his year target. Last week, he told clients that even in the 2013-2015 bear market, Bitcoin ”never sustained a move below breakeven”. He told clients:
While Bitcoin broke below the psychologically important $6000, this has lead to a renewed wave of pessimism… But we believe the negative swing in sentiment is much worse than the fundamental implications
This week however, Bitcoin has dropped further. It almost hit $4000 yesterday on Bitstamp. Despite this, Lee has told CNBC that he remains bullish on Bitcoin and bets on a recovery soon. After Bitcoin hits a fresh year low, the Wallstreet advisor says:
”Days like this, it does make me wonder (about my prediction)… this past few days has definitely been a negative development”
Lee, who still put the fair price at $7000, contended that more institutional involvement and oversight from U.S regulators could help bolster prices as the year ends.
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