Fundstrat managing partner Tom Lee predicts that crypto markets will likely catch up once gold and silver begin to take a break from their recent rallies.
Tom Lee said on CNBC’s Power Lunch on Monday that crypto should be going up on a weaker dollar and an easing Federal Reserve.
However, it doesn’t have the leverage tailwind because the industry delevered, “and as long as gold and silver are rising, then there’s a FOMO into buying that instead of crypto,” he said.
Gold prices hit an all-time high of $5,100 on Monday, following a gain of 17.5% since the beginning of the year. Silver also skyrocketed, hitting a peak price of $110 at the same time after gaining 57% so far this year.
Market observers have attributed the surge in precious metals to rising geopolitical tensions, trade tariff threats, and US dollar weakness, driving investors to safe-haven assets.
Tom Lee talks about commodities and crypto on CNBC. Source: CNBCOctober crash still hurting markets
Earlier in the interview, Lee explained that markets were still feeling the ripple effects of the Oct. 10 deleveraging event, which “crippled many key players in the industry,” including exchanges and market makers. As a result, he said, the industry is “limping along, but the fundamentals have improved a lot.”
Bitcoin (BTC) has lost 30% of its value since its October peak and is struggling to find any momentum above $95,000, having tanked back to support at $86,000 on Monday.
Related: Gold hits record high over $5K, further diverging from Bitcoin
“I think the precious metal move has sucked a lot of the oxygen out of the room,” said Lee.
Meanwhile, Tom Lee’s Ether (ETH) treasury firm BitMine bought another 20,000 ETH for $58 million on Monday, according to Lookonchain.
The Davos event also “highlighted financial institutions are set to build on Ethereum and smart blockchains,” Lee said on X.
Bitcoin needs risk appetite, not fear
However, CryptoQuant analyst “GugaOnChain” said on Monday that dollar weakness does not automatically mean Bitcoin will rise.
“The flight from the dollar to gold, while Bitcoin ETFs suffer massive outflows, proves that in moments of panic, the refuge is classical, not digital,” they said.
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Source: https://cointelegraph.com/news/when-gold-silver-take-break-btc-eth-will-surge-tom-lee?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
