Fundstrat’s Tom Lee has just made an argument that a strong macro outlook will provide the ‘tailwinds’ for the next bitcoin bull run.
The co-founder of Fundstrat Global Advisors recently sat down with CNBC on their Fast Money segment this week. Lee started saying that investors buy into bitcoin to hedge macro risks, viewing the asset as a safe-haven asset for a type of digital gold.
But in reality, his view is that investors will start buying into crypto when they feel optimistic in regards to the wider economy. Geopolitics and industry and traditional markets are booming.
“Bitcoin has stalled recently because the macro outlook has stalled. In a world without trend, Bitcoin doesn’t go up. So I think the next big catalyst is a decisive breakout in the equity markets because once equities reach an all-time high, Bitcoin becomes a risk-on asset.”
The wall street strategist has said that Fundstrat has provided an analysis for its clients which suggests that over the past ten years, the three or four best performing years of the S&P 500 Index have all coincided with the best years for bitcoin.
The main argument that Lee puts forward is countered by the notion that investors turn to the flagship currency as a way to hedge against the bleak macroeconomic climate, he didn’t rule out the chance that bitcoin could be both a risk-on and risk-off investment.
“Bitcoin may be ambidextrous: it works well in a risk-on world, but when you start to get nervous, then you treat it like digital gold. What we had in the summer [...] was a market that looked like it was on a precipice, that looked like it could fall — but it never did. And I think getting stuck in that trend was bad for Bitcoin.”
It will be interesting to see how this plays out and how accurate Lee turns out to be. For more news on this and other crypto updates, keep it with CryptoDaily!