Wall Street analyst says bitcoin could hit $91,000
Could bitcoin edge towards $100,000? At least one Wall Street advisor thinks it will happen.
Two years is a long time in the tech world, and it's an eternity in the cryptocurrency universe. With cryptocurrency markets showing significant volatility, it's hard to make long-term projections, but one analyst, Tom Lee from Wall Street company Fundstrat Global Advisors, thinks bitcoin could reach $91,000 by March 2020.
Lee is also the creator of the Bitcoin Misery Index (BMI), which suggests the best time to buy bitcoin is right at the moment when predictions of its future seem most dire. He suggests when the index is below 27, it's a good time to buy. The BMI is currently tracking in the mid to high teens. Commensurately, when the BMI is in excess of 67 on the scale of zero to 100, Lee says it's time to sell.
Fundstrat's model employs measures such as the cost of mining bitcoin; daily, hourly and monthly trading trends; and traditional technical analyses by charting patterns to make predictions about price movements.
Those analyses have caused Lee to revise his predictions from July 2017 when he said bitcoin would reach $55,000 by 2022. He's now saying $91,000 is the likely price by March 2020 – just two years from now.
According to Forbes, Lee and his team have shown that bitcoin’s three of the last four declines of 70% or greater since 2010 have been followed by significant gains.
The declines, as shown on this chart from Fundstrat, are on a logarithmic scale so they don't look as pronounced as you'd expect, but each of the falls has preceded an even greater jump.
According to Coinschedule, there were 210 ICOs last year and there have already been 86 so far in 2018. That means that this year, we have already doubled the total number of ICOs from all of 2016. Lee has said that Fundstrat is likely to focus their strategies on a couple of the more prominent cryptocurrencies, such as bitcoin and Ethereum, as well as on some trading in less well-known alt-coins with the expectation that many of the 1500 or so cryptocurrencies on the market will fade from existence over time.
Of course, past performance is not always an indicator of the future, so it's possible Lee has gotten things wrong – but it's an interesting analysis nonetheless.