Bitcoin to go hand in hand with S&P 500 – Tom Lee

  • A head of the research company  Fundstrat Global Advisors believes in bitcoin’s growth.
  • Bull’s run on stock markets will push digital assets out of the ranges.

Co-founder of Fundstrat Global Advisors Tom Lee shared his views on the state of the cryptocurrency market in the recent interview with CNBC.

A prominent Bitcoin bull retains his optimistic stance, saying that the first digital currency will hit a new record high soon. However, he also added that the market desperately needs a catalyst to escape its range-bound and directionless trading. Lee bets on a stock market rise.

“Bitcoin has kind of stalled recently because the macro outlook has stalled. I think, in a world without trend, bitcoin doesn’t go up. The next big catalyst, I think, is a decisive breakout in the equity markets, because I think once equities break to an all-time high, bitcoin becomes a risk-on asset.” Lee said speaking on CNBC’s “Fast Money.”

He believes that a stimulating monetary policy approach exploited by global central banks will result in strong liquidity growth. Considering a low-interest-rate environment, investors will seek for alternative assets to park their money.

“If markets make a new all-time high and we see central banks still supportive, it’s kind of good for liquidity, so there’s … liquidity going into bitcoin. More importantly, if there’s an interest in acquiring some volatility, that’s where you’re going to see people buying bitcoin,” he said.

Lee expects the S&P 500 to hit at least 3,125 by the end of the year. If history is any guide, the rally could create a necessary precondition for another strong bull’s run on the cryptocurrency market. 

“Bitcoin does best when the S&P’s up more than 15%. Bitcoin may be ambidextrous [in]that it works well in a risk-on world, but as you start to get nervous, then you treat it like digital gold,” Lee explained.

At the time of writing, BTC/USD is changing hands at $10,400, mostly unchanged both since the beginning of the day and on a day-on-day basis. All major altcoins are oscillating in tight ranges with no clear direction.

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