A sudden surge in bitcoin prices rekindled enthusiasm among cryptocurrency enthusiasts last night, and one of the biggest bitcoin bulls on the street predicts crypto could triple in price by the end of this year.
“We still feel pretty confident that bitcoin is a great risk-reward and we think it could reach $25,000 by the end of the year,” said Thomas Lee, co-founder and head of research at Fundstrat on Thursday.
If bitcoin reaches $25,000, this would indicate a 225% increase from its Thursday price. Even if it regains its December highs, there would be at least 25% upside still. Bitcoin was at $7,662 by midafternoon on Thursday.
Bitcoin has had a very shaky start to the year after it hit its record high of $19k in mid-December. Despite Thursday’s surge, prices still remain 61% below those highs.
It’s about time bitcoin recouped those losses, according to Lee.
“It’s overdue. Bitcoin was incredibly oversold,” Said Lee. “When you look at metrics like price-to-book, which is ‘money cost,’ or our bitcoin misery index, it’s pretty much what you saw at the end of the 2014 bear market, not the start,” he added.
Bitcoin dropped into a bear market in 2015 and 2015 after Mt. Gox, the largest bitcoin intermediary at that time, filed for bankruptcy and suspended trading after announcing the theft of over 800,000 bitcoins. Bitcoin prices hit the lowest point around mid January 2015.
But recent price drops during the first quarter of 2018 and even during the first half of April may have revived fears of a long recession. According to Lee, such fears are unjustified. He said fears were likely due to the pressure on cryptomarkets in the tax-selling season. “Investors have unloaded some of their bitcoin holdings in the past few weeks to cover capital gains taxes tied to those positions,” he said.
According to Funstrat Research, bitcoin trading this April shows an important technical reversal that may indicate further upside ahead. Bitcoin remained at a steady rate of $6,500 in the past two weeks, indicating a breakthrough to the March downtrend resistance.
Bitcoin went up nearly 11% higher on Thursday. At some point early on Thursday, its price went up to more than 17% at $8,000. The last time bitcoin moved to and above that level was at March 28.