FundStrat Global Advisor co-founder Tommy Lee predicts Bitcoin (Bitcoin) price to skyrocket above $25,000. The strategist said in an interview with Business Insider that 5% of gold’s market cap would give rise to a “conservative” estimate of $25,000 per coin in five years.
“It's actually the most conservative collection of elements to get to the 5%. Because number one, we assume that gold only appreciates essentially a nominal GDP. So there's no inflation,” he told host Sarah Silverstein.
“The 5% number really reflects the assumption that investors will allocate in their blended portfolio only 5% to alternative currencies,” he continued.
“Today, that allocation is much greater, it's closer to 10% or 15% in some portfolios. So, at a 5% allocation it would value Bitcoin at $25,000. You could easily get to $100,000, $200,000 numbers,” Lee said.
“In the short-term we think Bitcoin has really followed very closely the idea of acting like a social network. Meaning the more engagement there is, the greater the value rises. And in the short-term, we think Bitcoin will reach at least $6,000 by mid-2018,” he added.
Tommy Lee prefers Bitcoin over gold as a store of value. “There's a whole generation of young people that would say they don't understand why gold at all represents a store of value. And it's important to keep in mind that gold’s price never even moved when it was – when the dollar was on the gold standard. So I would say I would easily change that for a Bitcoin.
“When people talk about Bitcoin’s volatility today, they're forgetting that when we went off the dollar — the gold standard on the dollar, gold’s volatility for four years was about the same as Bitcoin’s volatility today,” he concluded.