BY Fintan Ng - October 5, 2018
Wall Street and Twitter users differ on calling bitcoin price bottom
Institutions and Twitter users are split on bitcoin’s price, an impromptu poll by Fundstrat Global Advisor’s managing partner Thomas Lee shows.
While the price of bitcoin has been pretty stable due to rangebound trading over most of September and going into October, Twitter users have been more cautious about calling a bottom on the price.
Bitcoin fell to the year’s low of US$5,826.41 on June 24 according to CoinMarketCap data and while prices have stayed mostly above US$6,000, the markets seemed not to be able to shake off the bears.
Lee polled 25 Wall Street institutions during a recent dinner and the results were surprising. A majority of the usually more cautious institutions say that bitcoin’s price has “already bottomed”.
Lee, who spoke over the phone with CNBC in an Oct 4 interview, says their responses were compared with the answers to a Twitter poll that received 9,500 responses.
The Twitter poll showed that Twitter users feel that the price has more room to fall. To a question on when the price will bottom, 44% of Twitter users responded that the price has bottomed compared to 54% of institutions, who believe that the worst is over.
Lee shared that institutions were also more bullish about how high they think the price can go, with 57% saying the price could go anywhere from US$15,000 to “the moon”, a slang term among crypto investors of prices that can surge to stratospheric levels.
According to him, Twitter users were less optimistic, with 40% predicting that price movement.
The cryptocurrency markets have certainly seen more interest from institutions this year, although there have been setbacks, including the US Securities and Exchange Commission’s postponing the decision on whether to allow rule changes that will see the listing of bitcoin-based exchange traded funds.
Other news included the tentative steps taken by Goldman Sachs and BlackRock in studying cryptocurrencies and the underlying blockchain technology, although both have since backpedalled on more concrete plans in investing.
While the news flow has not been exactly great, bitcoin’s price has weathered it pretty well, with some volatility but holding up by not dropping to the year’s low.
Some believe that the more stable prices are a sign that institutions will be persuaded to dip their toes into the markets, and that when a Goldman Sachs or a BlackRock really decides to invest, the markets will surge.
Lee also pointed out that in the survey, the majority of respondents say central banks play the “most important macro factor” influencing prices, which confirms a recent Bank for International Settlements study that certain regulatory action or news can have a substantial reaction from the crypto markets.