Fundstrat Global Advisors co-founder and renowned crypto bull, Tom Lee, went to dispel bearish sentiment against bitcoin’s practical use and its price on CNBC’s ‘Fast Money’ on Monday. The show’s host, Melissa Lee, pointed out that there are three things the bears held against bitcoin.
First, Google search trends for bitcoin have dropped to almost 25% at the stat of the year. Many bitcoin bears believe this is an indication that investment interest in the cryptocurrency has gone down. While this may be true to some extent, Tom Lee was quick to point out that the Google Trends Indicator was not completely indicative of the price and popularity of bitcoin.
“Google searches aren’t the leading indicator for Bitcoin, but instead, acts as a ‘coincident indicator,’ and therefore shouldn’t be looked to as some sort of BTC price predictor,” he said.
In this case, the “coincident indicator” implies that it moves in connection to Bitcoin’s price, rather than actively indicating the price movement of the coin. Lee is confident that traditional institutions still have interest in investing in the cryptocurrency space, despite the short-term bear market experienced by the crypto market.
Another that bitcoin bears made was that trading volumes have dropped since the bull run last year. According to CoinMarket Cap, bitcon’s trading volume is down by more than 75% since December last year.
To fight this supposed bearish indicator, Lee cited last year’s run-up a “parabolic blow off”. Basically this means he thought the volume seen during late last year was an unusual figure, and shouldn’t matter now.
“Compared to a year ago, (over) the same time (the first 6 months of 2017), Bitcoin volumes are up nine hundred percent,” he said.
Lee still believes that the volume present in the crypto trading industry is still “healthy”.
Lastly, Lee addressed the opinion that bitcoin has been struggling to break above the $10,000 range. To help support his bullish views on the crypto industry, he cited a research done by Fundstrat, his market analysis firm. Lee specifically said:
“Bitcoin makes all of its performance in 10 days, in any year. So I don’t think that the fact that it is at the current levels is going to prevent it from actually rising before the end of the year.”
If bitcoin’s price continues to move downward, Tom Lee stands by his belief that bitcoin will hold price levels at the cost of mining a single bitcoin. Based on data from his firm, the current cost of mining one bitcoin is at $6,000 and if bitcoin should drop to $6,000, worst comes to worst.