Wall Street Analyst Says One Catalyst Will Trigger Bitcoin All-Time High and Altcoin Season

The co-founder and head of research at Fundstrat says a healthy S&P 500 will be a major catalyst for the next Bitcoin bull run.

In a new interview on CNBC’s Fast Money, Tom Lee says BTC has thrived when the S&P 500 is doing well.

“Bitcoin has stalled recently because the macro outlook has stalled. In a world without trend, Bitcoin doesn’t go up. So I think the next big catalyst is a decisive breakout in the equity markets because once equities reach an all-time high, Bitcoin becomes a risk-on asset.

We published a piece today showing our clients that if you look at the last 10 years and take the three or four best years of the S&P, they’ve all coincided with the best years for Bitcoin. So Bitcoin does best when the S&P is up more than 15%.”

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As for the narrative that Bitcoin is also emerging as a hedge against economic uncertainty, Lee says it’s a possibility, although he believes this summer’s on-again, off-again global financial concerns didn’t help BTC.

“Bitcoin may be ambidextrous. It works well in a risk-on world. But as you start to get nervous, then you treat it like digital gold. What we had in the summer was neither environment. It was a market that looked like it was on the precipice. It looked like it could fall but it never did. And I think stuck in that trend was bad for Bitcoin.”

“I think that we’re inching closer. Our base case has been for a second-half rally in the S&P 500 to greater than 3,125. All-time high is around 3,025. I think we’re going to surpass that soon and it would be bullish for Bitcoin.”

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As for when altcoin season may begin, Lee says he thinks it’s likely to happen once Bitcoin breaks through to a new all-time high.

“I think there’s a bit of sobering around alts in that some are useful but [people] aren’t really sure how to trade the whole group. So I think what may end up playing out is the S&P hits a new all-time high. Bitcoin reaches an all-time high, which is not too far away for Bitcoin. And then I think it would likely lead to the start of alt season.”

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