On Thursday, July 5th, in two CNBC interviews, Tom Lee of the financial market research firm Fundstrat defended his position that, by the end of the year, Bitcoin (BTC) would trade between $22,000 and $25,000. Lee made sure to make it clear to reporters emphatically that his most recent price forecast of $22,000 is not a bearish reversal of his previous $25,000 estimate.
Lee, a famous Bitcoin (BTC) “bull,” is renowned for his January prediction that Bitcoin would reach $25,000 by the end of 2018, while in March he also said that BTC would reach $91,000 by 2020.
Speaking at CNBC’s “Squawk Box” segment on Thursday morning, Lee at first seemed to have tempered his bullish sentiments on Bitcoin (BTC) by saying that “it is not ruled out that the BTC could be above $20,000 by the end of the year.”
Lee based his justification for this recalculation on the historical correlation between Bitcoin (BTC) price and the costs of mining, which he said would be around $9,000 per mined coin by the end of the year.
Tom Lee says on CNBC that Bitcoin (BTC) price will reach $22,000 by the end of the year
Reappearing on CNBC on Thursday afternoon, Lee was quick to clarify what he considered an exaggerated reaction to his morning remarks, saying that:
I think this is the first time I’ve heard anyone think that something could triple is a bearish comment. I think I may have been a little wrong what I was trying to illustrate is that (…) applying the historical average of 2.5 times the mining costs would imply a fair value of more than $20,000 – about $22,000
Tom Lee, on CNBC
“I still think that Bitcoin (BTC) can reach $25,000 by the end of the year or so,” added Lee.
Last May, Fundstrat published its internal analysis of the relationship between BTC mining costs and price behavior, stating at the time that the data had “demonstrated a reliable level of long-term support.” These statistics proposed, in particular, a historical average slightly lower than the current figure, and forecasted that the price of Bitcoin (BTC) would be around $36,000 by the end of 2019.
At the moment of this article, Bitcoin (BTC) is trading at $6,612, recording a drop of 1,15% in the last 24 hours.
Ian Kennedy is the newest contributor to Crypto Daily Gazette. He enjoys running, practicing minimalism and cooking. Ian is a graduate of Wesleyan University in Connecticut where he studied journalism, Arabic and international affairs. Ian mostly covers stories concerning emerging blockchain technology.