Bitcoin (BTC) to Hit $200,000 in Q4? Tom Lee Explains How
- Tom Lee noted that the upcoming Fed monetary policy decision will be a major catalyst for cryptocurrencies.
- Fundstrat's Lee said Bitcoin will perform well in the fourth quarter, which begins in three weeks.
- The Bitcoin network has accumulated several game-changing fundamentals, but economic uncertainty has suppressed its value.
Tom Lee, co-founder and head of research at Fundstrat Global Advisors, has made a bold mid-term prediction for Bitcoin (BTC). In an interview with CNBC on Monday, Lee said BTC could easily reach $200,000 by the end of 2025.
On Tuesday, September 9, Bitcoin price was hovering around $112,609 midway through the European session. Over the past few days, the flagship coin has bounced off important support above $107,500 and is currently approaching resistance around $113,370.
So, if Lee's prediction comes true by the end of this year, BTC holders will see their portfolio grow by 78%.
Why is Lee so confident about Bitcoin's surge in Q4?
According to Lee, Bitcoin and the entire crypto market are awaiting the Fed's monetary policy report next week. Given last week's report on the weakness of the labor market, traders Kalshi and Polymarket are betting on an 86% chance that the Fed will cut rates by 25 basis points.
Thus, Lee believes that Bitcoin will receive a much-needed catalyst for rapid growth in the fourth quarter. Moreover, Lee emphasized that the cryptocurrency market often shows good results in the fourth quarter.
Related: Bitcoin ETFs Receive $246M Inflow, But Overall Market Remains Cautious
“Bitcoin and cryptocurrencies like Ethereum are very sensitive to monetary policy. If the Fed cuts rates, it could set the stage for a very strong fourth quarter,” Lee said.
An instructive story
JPMorgan's trading desk warned traders Monday of a potential market pullback following the Fed's rate cut. JPMorgan said potential selling on the news could impact the broader market.
However, the bank noted that markets could continue to maintain an optimistic outlook even after the Fed initiated a rate cut, since there is no recession.
What Will Drive BTC's Expected Growth in Q4?
Supply and demand shock
The Bitcoin market has been bullish in recent months, thanks in large part to increased demand from institutional investors. Michael Saylor’s strategy led 319 institutions managing 3.71 million Bitcoin in treasury assets, according to market data from Bitcoin Treasuries.
Given strong demand from other large investors, especially spot bitcoin ETFs, the fourth-quarter rally will be driven by a strong supply and demand shock. According to market data from CoinGlass, bitcoin supply on centralized exchanges has fallen to a multi-year low of around 2.1 million amid ongoing bitcoin price consolidation.
Source: CoinGlass
Fed Monetary Policy
The Federal Reserve, while keeping its benchmark interest rate at 4.25% to 4.5%, is expected to cut it at least once before the end of the year. Moreover, Wall Street experts note that tariff-induced inflation is temporary.
Related : September rate cut probability rises to 90.4% after weak jobs report
The Inevitable Outflow of Capital from Gold
Bitcoin's price has followed gold's dynamics for years, but with a higher growth rate. Moreover, Bitcoin has come to be considered digital gold, with more and more investors buying it to hedge against inflation and macroeconomic uncertainty.
Notably, the gold price recently broke out of a medium-term consolidation and hit a new all-time high of around $3,647 per ounce this morning.
Source: cryptonews.net
