Analyst Tom Lee from Fundstrat says that he is surprised by BTC’s recent stability. He made this statement on CNBC’s Squawk Box in an interview Oct. 29.
Bitcoin (BTC) Price Today – BTC / USD
He expressed his surprise at the cryptocurrency’s recent behavior and compared the situation with the nine percent slump in equity markets generally. The analyst expected the volatility of the coin to be far higher considering how small it is in terms of market cap.
A good time to invest
Lee was asked whether this stability is a good sign for intending investors. He answered in the affirmative stating that “Bitcoin seems to find its floor at $6,000.”
He also spoke about the sustained price of BTC and said the digital currency needed more fiat inflows. This means more adoption. It should start happening by year’s end or early next year. Many new platforms to be launched and offerings from Fidelity and Bakkt will come in handy in this instance.
Another serious factor that can affect the price growth of BTC is currency. Lee believes this because the cryptocurrency is priced in USD. He said,
“So dollar strength has actually been a headwind for Bitcoin. But if the dollar begins to weaken, there will be a tailwind for Bitcoin,”
Decline in volatility
The crypto market has seen a continued stagnation for a few weeks now. Many digital currencies have dipped in price due to this stagnation. A few days ago, data from Bitcoinity revealed that there had been a consistent decline in the volatility of BTC. It was calculated as an average standard deviation from market trades all through this year. One different explanation of the price stability could be the low trading volumes of bitcoin.
The crypto market experienced some volatility on Oct. 29. All the coins were in the red during this time. As the time of writing this article, BTC is trading at $6,314. It has increased by a meager 0.41 percent. Still, it is down by about 2.62 over the previous week as reported by CoinMarketCap.
In the past, Lee claimed that the digital currency could increase massively. He cited the correlation between the emerging markets and bitcoin. This crucial correlation lies in the fact that the markets are running parallel to each other. He spoke about the peak they reached in the early part of this year as well as the downward trend from that period.
Last month, a Fundstrat survey of 9,500 responses and 25 institutions was conducted on Twitter. The results led Lee to conclude that Wall Street is predicting a bottom in bitcoin. A whopping 57 percent of the participants said that the price of BTC would reach $15,000 and even go higher than possible next year.