Spot ETF Approval Could Propel Bitcoin Price Beyond $150K, Tom Lee Forecasts

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The future of Bitcoin’s price has garnered the attention of experts and enthusiasts alike, with a bold prediction from Tom Lee, Co-Founder of Fundstrat Global Advisors, taking center stage. Lee’s forecast suggests that the price of Bitcoin (BTC) could experience a significant surge, potentially surpassing $150,000 and even soaring to an impressive $180,000. This remarkable uptick, Lee asserts, hinges on the approval of a spot Bitcoin exchange-traded fund (ETF) in the United States.

Tom Lee’s projection finds its roots in the delicate balance between supply and demand. Lee suggests that the demand for Bitcoin could outstrip its daily supply, setting the stage for a substantial price shift. Speaking about this potential development, Lee explained:

I think the demand will be greater than the daily supply of bitcoin, so the clearing price […] is over $150K, could even be like $180K.

The path to this projected surge lies within regulation and investment instruments. The concept of a spot Bitcoin ETF is at the heart of Lee’s forecast. A spot ETF would offer investors a way to gain exposure to Bitcoin’s price movements without owning the digital asset. This instrument’s approval is currently under the scrutiny of the U.S. Securities and Exchange Commission (SEC), a regulatory body tasked with ensuring market integrity and investor protection.

“If the Spot #Bitcoin ETF gets approved … the clearing price of $BTC is above $150,000.” – Tom Lee @fundstrat pic.twitter.com/ILQZqdjsZA

— Michael Saylor⚡️ (@saylor) August 16, 2023

Lee’s claim of a possible surge beyond $150,000 isn’t without a basis. Bitcoin has been a topic of conversation and scrutiny for some time, and its value has shown noteworthy growth. Since mid-July, Bitcoin has traded within a relatively narrow range of $28,900 to $30,200, contributing to decreased volatility. In the most recent mid-afternoon trading session, the price of Bitcoin dipped 0.4% to $29,100.

Bitcoin has seen impressive growth year-to-date, with its value increasing by approximately 75%. This surge in value is occurring concurrently with a wave of interest from financial firms seeking to create ETFs directly invested in Bitcoin. Companies like BlackRock and Fidelity Investments have submitted applications to the SEC for approval, and the regulatory decision-making process is ongoing.

Lee’s optimism extends even beyond the potential approval of a spot ETF. Even if such an ETF doesn’t receive the green light, Lee believes that factors could still contribute to Bitcoin’s upward momentum. He noted:

There’s still upside catalysts because of the halving next year.

He asserted that this halving would lead to a reduction in Bitcoin’s coin supply. The halving event, a planned reduction in the rewards miners receive, has historically impacted Bitcoin’s price.

Lee’s Projections and Yusko’s Parallel Perspective

Lee also delved into inflation, suggesting that a decline is on the horizon. While the recent core inflation rate stood at 0.16%, Lee indicated that this figure was influenced by surging housing costs, particularly in shelter expenses. He anticipates these costs will start to moderate, potentially leading to a decline in inflation to below 2% by the middle of the following year.

Lee highlighted the connection between these digital assets and monetary policy in cryptocurrencies. He suggested that a decline in inflation could pave the way for more accommodating financial conditions and even policy easing by central banks, which could positively impact cryptocurrencies.

Mark Yusko, the CEO, Founder, and Chief Investment Officer of Morgan Creek Capital Management, shares a similar sentiment to Lee’s perspective. He also envisions the possibility of Bitcoin’s price ascending to $150,000 based on two pivotal factors: the potential endorsement of a spot Bitcoin ETF and the upcoming Bitcoin halving event slated for April 2024.

Yuko believes that approving a spot Bitcoin ETF, coupled with the effects of the halving (a reduction in block rewards for miners), could contribute to substantial price appreciation. He articulated:

By the middle of summer next year, $100,000 will be fair value. But we’ll have speculation … so let’s say we blow through that $100k, and we’re at $150k. That seems reasonable to me.

Considering Historical Context

Given his history of making assertive predictions about Bitcoin’s price, Tom Lee’s insights have garnered attention. While past forecasts didn’t perfectly align with actual market outcomes, Lee’s views continue to offer valuable perspectives on the potential trajectory of Bitcoin’s value.

In late 2020, Lee anticipated Bitcoin reaching $120,000 the following year. Although the cryptocurrency demonstrated growth, it peaked at $69,000 before entering a bear market.

In February 2022, Lee predicted Bitcoin could surge to $200,000, yet by 2022, it had experienced a bear market low of $16,000. As the regulatory journey continues and market dynamics evolve, only time will tell if Lee’s projections come to fruition.

While experts offer differing views on the potential trajectory of Bitcoin’s price, some analysts are expressing concerns about Bitcoin’s current state, describing it as weak. There’s even talk of a possible “savage breakdown,” suggesting a substantial decline in its value could be on the horizon.

looking like #btc is about to lose this channel we formed over the last 2 weeks, all bounces from the highs have been super shallow with none even reaching any 0.618 fib levels.

btc looking super weak to me with alts looking even worse and i cant help but feel a savage breakdown… pic.twitter.com/WYPwgQGSGU

— Bluntz (@Bluntz_Capital) August 16, 2023