Managing Partner and Head of Research at Fundstrat Global Advisors, Tom Lee, recently made an appearance on CNBC‘s ‘Street Signs Asia‘ segment to talk about Bitcoin price movements in the future. Lee also spoke about why he thinks Bitcoin will touch $25K by 2022.
According to Lee, for an industry that’s over a decade old, these are still early days for digital assets. However, as time passes, it will become very institutional, he said. Fundstrat’s Lee added,
“Over time, it’s going to become an asset class, and once we hit that it’s actually another hockey stick.”
When asked about his prediction for the king coin’s price, Lee said that it had been established back in 2017 as a five-year prediction. According to him, the predicted goal would be easy to achieve due to cryptocurrencies being network value assets — the more people that hold it, the greater its value.
“In fact, it’s a log function, so if you double the users you get a quadrupling of value, and to go to $25,000 you essentially need a 4x rise (a little bit less than that) which means you need to double the number of people who hold Bitcoin.”
According to Lee’s estimates, there are under half a million people in the world who own and use Bitcoin widely today. He also compared Bitcoin to Internet stocks such as FAANG and attributed 70% of their returns since the IPOs to the growth of the Internet over that period of time.
“So in other words, it was a log function of the Internet growth, and that’s how cryptocurrencies are going to work. That’s just saying if you take it to a million users, you could get to $25,000.”