“Hodl” your horses: bitcoin’s back.
The digital currency has surged this year, cracking the $8,000 level on Tuesday for the first time in nearly 12 months. The move more than doubled bitcoin’s gains for 2019 ahead of Consensus Week — the crypto industry’s annual confab — kicking off on May 13.
Tom Lee, head of research at Fundstrat Global Advisors and a well-known bitcoin bull, said the New York-based conference will be key in determining whether bitcoin’s recent rally means it’s truly out of the woods.
“It’s the largest crypto conference,” Lee said Tuesday on CNBC’s “Futures Now.” “I think that, really, this year is bringing the crypto industry together, but in a much more higher-quality form because you don’t have as many sort of scams and ICOs out there.”
If it goes well, Consensus Week — a gathering of industry specialists, company leaders like Square and Twitter’s Jack Dorsey and government officials like SEC Chairman Jay Clayton — will be the latest sign that the “crypto winter” is ending, Lee said.
Other signs Lee noted were bitcoin crossing above its 200-day moving average in April, developments in the bitcoin futures market, and longtime bitcoin “hodlers” — industry jargon for people who buy and hold the currency rather than trading it — increasing their positions.
But there’s one thing that could supercharge bitcoin’s rally, Lee said Tuesday.
“I think what’s getting investors quite optimistic is that now that bitcoin is approaching that $10,000 level, I think that there’s an increasing chance that traditional, non-crypto investors, traditional financial investors, are going to start to look at crypto again,” he said. “And that’s very important, obviously, because bringing in that new sort of interest and demand into crypto could really push bitcoin to its all-time high.”
Bitcoin prices have failed to break above their 2017 all-time highs of nearly $20,000. A rally back to those levels would represent a roughly 150% move for the cryptocurrency.
In April, Lee said bitcoin was “likely” to reach new all-time highs by 2020, particularly as supply shrinks. Ongoing U.S.-China trade tensions may also contribute to the rally as investors increasingly see bitcoin as “digital gold” that can be used to hedge against tail risk, he said Tuesday.
Bitcoin prices traded higher on Tuesday after crossing, but failing to hold, the $8,000 level. The digital currency is up by more than 113% year to date.