Fundstrat Partner Tom Lee Surprised By Bitcoin Stability
Tom Lee now says that crypto is now a non-volatile asset.
Tom Lee Shares Insight On Bitcoin Stability
Over the last month, bitcoin and many altcoins have appeared to be stable. Their volatility has remained low compared to traditional markets like the American stock exchanges. The US stock market plunged and has wiped out most of the gains recorded this year.
Data indicates that bitcoin’s volatility has dropped below that of major firms like Amazon, and Netflix stocks. The volatility was reviewed for a 20-day period. This development has caught many investors unaware. It is a surprise that cryptocurrencies have moved a minimum of 3% daily.
Crypto market expert, Tom Lee recently sat down with CNBC to give some insight into the development. Lee started off by highlighting the present state of the stock market. The market has dropped by about 9% from the beginning to the end of Oct.
Lee who serves as a partner at Fundstrat said that bitcoin is now a non-volatile instrument, a phrase strange in the crypto circles. His statement was driven by the fact that bitcoin’s volatility has not been effected considering that the stocks are experiencing a hard time at the moment.
The bitcoin crusader added that a look at the several previous days, bitcoin has been performing relatively better than the traditional stock market. He opined that bitcoin has been better compared to markets that have remained in a state of low volatility for years.
He acknowledged that the development is a surprise since bitcoin has a small market cap. The entire crypto market is capped at $200 billion while global assets stand at $90 trillion although when taking the derivatives market into account that number would be much higher.
Asked on the recent attack on the crypto sector, Lee maintained that bitcoin has managed to stabilize at $6,000. This year, the crypto sector has been under scrutiny after it dropped by 70%. Many believe that bitcoin's stabilization at $6,000 is an essential floor to hold.
Lee said that for the cryptocurrency sector to grow, mainstream adoption is key. He pointed out that we need catalysts like fiat inflows for the sector to sustain growth. He further projected that fiat on-ramp in the crypto sector will troop in by the end of the year.
Lee further echoed his previous comments where he said that the crypto market might remain stagnant in the event that upcoming markets begin to witness reversals. He said that the market might neither drop nor grow. By press time bitcoin was valued at $6,315 representing 0.3% change in the last 24 hours.