Bitcoin Bull Tom Lee Refutes Bearish Arguments, Sticks to his Bitcoin Price Prediction
Tom Lee, co-founder of Fundstrat Global Advisors and a well-known bitcoin bull, who has always shown his unwavering support to Bitcoin and made many reliable bitcoin price predictions has refuted various arguments bears use against the flagship cryptocurrency.
Tom Lee recently appeared on CNBC’s “Fast Money” with Melissa Lee, who said bitcoin bears usually use three main arguments: a decline in search engine queries, a decline in trading volume, and the cryptocurrency’s inability to break through the $10,000 psychological barrier.
Google search trends for Bitcoin are down. They are nearly 75% lower than the height of searches at the beginning of 2018. Tom Lee explained that it makes sense that the searches were way up during Bitcoin’s end of 2017 run but that the number itself doesn’t necessarily determine the price of the digital asset.
To this, Lee said,
“Google searches aren’t the leading indicator for Bitcoin, but instead, acts as a ‘coincident indicator,’ and therefore shouldn’t be looked to as some sort of BTC price predictor.”
The bears’ second argument, that cryptocurrency trading volumes are down by about 80 percent since bitcoin’s all-time high in mid-December, seemingly doesn’t concern Tom Lee as well. Per the analyst, cryptocurrency trading volumes are “healthy” when compared to last year. He said:
“You have to remember December was the parabolic blow off for bitcoin, and compared to just the second half of last year bitcoin volumes are up 40 percent, and compared to a year ago the same time, January to June, bitcoin volumes are up 900 percent.”
Finally, as for breaking the psychological $10,000 barrier, Lee pointed to regulatory uncertainty and technical issues affecting the cryptocurrency. He noted, however, that investors need to keep in mind bitcoin makes all of its gains in about 10 days in a year.
Tom Lee has in the past used this argument to claim hodling bitcoin makes sense, as he pointed out that last year 12 days represented the cryptocurrency’s full-year returns. Without these few days, Lee’s firm Fundstrat noted, bitcoin would be down an average of 25 percent per year.
Bitcoin holders shouldn’t have to worry about the coin dropping below the price of mining a Bitcoin. With the average price of mining one Bitcoin being around $6000, this would be the floor of a Bitcoin crash.
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