Fundstrat’s Tom Lee: Bitcoin to Rise When Metals Lose Momentum

TLDR

• Tom Lee said Bitcoin and Ethereum are likely to rally once gold and silver lose momentum.
• He explained that digital assets usually benefit from a weak US dollar and potential Federal Reserve rate cuts.
• Lee noted that the crypto market lacks leverage this cycle, which has slowed its usual upward momentum.
• Bitcoin is down nearly 30% from its October high and trades near the $86,000 support level.
• Gold has reached a record high of $5,100 while silver has surged 57% since the beginning of the year.

Fundstrat Managing Partner Tom Lee stated that Bitcoin and Ethereum could rebound as precious metals lose momentum, highlighting that crypto fundamentals remain stable despite recent underperformance. He also noted that gold and silver are attracting most of the current investor attention due to macroeconomic pressures and dollar weakness.

Bitcoin Faces Pressure as Gold and Silver Dominate Investor Sentiment

Tom Lee believes Bitcoin is undervalued due to a strong investor shift toward gold and silver. He explained that investors are favoring metals while Bitcoin struggles to recover from its October drop.

He noted that Bitcoin usually benefits from a weaker dollar and easing policies from the Federal Reserve. However, he emphasized that the current cycle lacks leverage, which previously boosted crypto momentum.

The Bitcoin price has failed to reflect stronger fundamentals, according to Lee. It remains nearly 30% below its October high and trades near the $86,000 support level. The ongoing strength in gold and silver has pulled investor focus away from digital assets.

Ethereum Gains Institutional Interest Despite Market Weakness

Tom Lee remains confident in Ethereum’s future and highlighted growing institutional support. He referenced discussions from the Davos forum, pointing to interest in Ethereum-based platforms. He added that financial institutions are now considering Ethereum for smart contract development.

Lee also cited a recent Ethereum investment by BitMine, a treasury firm affiliated with him. On Monday, the firm purchased 20,000 ETH worth $58 million. Blockchain analytics platform Lookonchain confirmed the transaction.

Despite a broad crypto slowdown, Ethereum continues to show signs of development activity. Lee said the October deleveraging event “crippled many key players” but fundamentals have improved since. He believes Ethereum will benefit once market sentiment returns.

Crypto Fundamentals Hold Steady Despite Metal Surge

Analysts attribute the metals rally to geopolitical tensions, trade concerns, and dollar weakness. Gold hit a record high of $5,100, rising 17.5% since January. Silver surged 57% year-to-date, reaching $110.

Lee said these moves are pulling capital away from crypto. He described the market as “limping along,” but argued that prices do not reflect the improving fundamentals. He stressed that crypto often rallies once metals stabilize.

Despite Bitcoin lagging, Lee does not view it as a weakness in the asset itself.

He expects Bitcoin and Ethereum to recover when metals plateau.

CryptoQuant analyst GugaOnChain disagreed with Lee’s view. They argued that current ETF flows favor gold during high-stress periods.

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