Thomas Lee Tells Investors to HODL on During Bitcoin Slumps

Lee has been predicting prices for Bitcoin since it was below $3000. He said it will reach $25,000 by the end of this year and $55,000 by 2022. He says holding is more reasonable for those who missed the 10 best days at the start of this year.

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Tom Lee, the former strategist at JPMorgan Chase & Co is urging you to hold on in the wake of a 40 percent decline in the crypto markets. He is currently the managing partner and head of research of Fundstrat Global Advisors LLC.

Bitcoin is not at its best right now, trading at below its breakeven cost of mining according to a Fundstrat model.

He says market timing is discouraging in traditional equity investing but if you missed out on the 10 best days for Bitcoin each year when Bitcoin gains were high, you might need to try out his free piece of advice.

He says,

“If an investor missed out on the 10 best days (for S&P 500) each year, the annualized return drops to 5.4 percent (ex-10 best), from 9.2 percent. In other words, the case for buy and hold in equities is the opportunity cost of missing out on the 10 best days.”

So because there are only a few days that account for the much of Bitcoin gains. Thus holding it is the more sensible option.

Further, Robert Sluymer and other Fundstrat analysts say that investors are sidelined due to the overhang from regulatory risk.

“However, we see positive catalysts for Bitcoin later in 2018, including the clarification of regulatory hurdles.”

These overhangs from U.S. Securities and Exchange Commission actions and a political backlash on cryptos, the company predicts a “purgatory” period forecast of 150 to 175 days aiming for mid-September.

Bitcoin predictions

Lee predicted this month that Bitcoin will reach $91,000 by March 2020. He based his predictions on Bitcoin’s (BTC) performances after past market dips. The company’s 2020 chart is based on a logarithmic scale as opposing to the traditional linear-based graph.

He has been predicting prices since Bitcoin was below $3,000 and says in July 2017. However that it would hit $55,000 by 2022. He also predicted recently that the cryptocurrency will hit $25,000 by the end of 2018.

What’s your prediction for Bitcoin this year? Share with us on Twitter and Telegram.

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David Kariuki is a journalist who has a wide range of experience reporting about modern technology solutions including cryptocurrencies. A graduate of Kenya's Moi University, he also writes for Hypergrid Business, Cryptomorrow, and Cleanleap, and has previously worked for Resources Quarterly and Construction Review magazines.

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