Bitcoin Isn't Broken

8 August, 2018

Fundstrat’s Tom Lee is convinced Bitcoin (BTC) has better days ahead – the long-time Bitcoin bull pointed toward a variety of factors, including Bitcoin’s gradually growing market dominance, which suggest the cryptocurrency is on an upward track.

Speaking to CNBC’s “Fast Money”, Lee said:

“The news that we have seen, from the SEC saying Bitcoin's a commodity, to ... the potential for an [exchange-traded fund] is causing investors to decide that Bitcoin is the best house in a tough market.”

Earlier this year, the United States Securities and Exchange Commission (SEC) ruled that cryptocurrencies were commodities, and followed that up with a statement in June which clarified that cryptocurrencies would not be treated as securities.

Other recent encouraging news includes reports that Goldman Sachs is considering a crypto custody solution, and an announcement by Intercontinental Exchange about the launch of a new company for trading cryptocurrencies in an open and fully regulated global ecosystem for digital assets.

Despite the slew of positive news, Bitcoin hasn’t displayed much of a reaction. Since April 2018, the cryptocurrency has been unable to break past the $10,000 milestone and has been ambling along in the $6000-$8000 range. This comes after Bitcoin touched an all-time high of around $20,000 in December last year, only to fall into a slump as 2018 progressed, dropping to below $6,000 in June.

However, despite its tepid performance recently, Lee remains hopeful.

“Bitcoin isn't broken if it's holding at these levels. I think people are afraid it is going to go back down to $6,000 and never come back from those bear markets.”

To bolster his bullish claims, Lee pointed out that Bitcoin’s gradually growing market share is a significant sign of the cryptocurrency’s impending return.

“I think Bitcoin dominance is actually showing the market is reacting to what's been taking place,” he noted.

Last year, Bitcoin’s market share peaked at around 86%, but at the beginning of 2018, this was down to around 36%. During the last few weeks, however, Bitcoin started to regain its dominance, which recently rose to 48% - the highest so far this year.

Source link   Crypto currency: Bitcoin

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