Fundstrat Global Advisors’ Research Head and Fundstrat Capital CIO Tom Lee believes the final stretch of the year could bring a dramatic turnaround for both global markets and cryptocurrencies.
In a recent appearance on CNBC’s Squawk Box, Lee painted a bullish picture driven by improving macroeconomic conditions, stabilizing inflation, and renewed on-chain activity that signals growing strength in the crypto sector.
According to Lee, October’s historic liquidation event – one of the largest sell-offs in crypto history – likely marked the end of the consolidation phase that began earlier this year. He noted that the cleanup of excessive leverage and the restoration of liquidity across major platforms have created the ideal setup for a new leg higher.
Lee predicts that Bitcoin could accelerate sharply toward the end of the year, potentially hitting between $150,000 and $200,000. He argues that Bitcoin’s supply-demand balance has rarely looked stronger, citing reduced selling pressure from miners, increased institutional inflows, and growing stablecoin activity as early signs of another major upswing.
Ethereum, he added, could follow a similar trajectory, with the potential to reach $7,000 if the current market momentum continues. “The fundamentals of crypto are improving while traditional finance is just starting to appreciate how deep the adoption curve runs,” Lee remarked.
Fundstrat’s analysis shows a sharp rise in on-chain activity across major networks. Stablecoin volumes on Ethereum have surged to multi-month highs, reflecting a renewed appetite for risk and capital movement within decentralized finance (DeFi). Meanwhile, blockchain platform revenues have hit record levels, suggesting sustained demand for transactional capacity and smart contract execution.
Lee also referenced the strong performance of crypto-related equities, such as mining firms and exchange-traded funds, as evidence that institutional sentiment is shifting from skepticism to re-engagement. “The worst may be behind us,” he said, noting that the October washout was “a necessary reset for a healthier market foundation.”
On the macro front, Lee highlighted the rapid decline in inflation as a major catalyst for the coming rally. He explained that housing costs – a significant component of core inflation – are easing faster than anticipated, while wage pressures and energy prices have moderated.
This cooling inflation, according to Lee, gives the Federal Reserve more flexibility to begin discussing interest rate cuts, which could unlock liquidity across financial markets. Lower borrowing costs would not only stimulate equities but also flow into digital assets, which tend to thrive when liquidity expands.
“The biggest change we’re seeing isn’t just in inflation,” Lee said. “It’s in confidence. Investors are beginning to look past the tightening cycle and toward a more constructive environment for growth.”
Lee expects this optimism to extend beyond crypto. He foresees a broad-based year-end rally in U.S. equities, led by technology and financial stocks, as investors reposition for a 2026 market upswing. Fundstrat’s models project double-digit gains for major indexes before year-end if inflation continues to decelerate and the Fed signals a pivot toward easing.
Despite his bullish outlook, Lee acknowledged the possibility of short-term volatility, especially around macro data releases and Fed communications. However, he stressed that these would likely serve as “buy-the-dip” moments rather than long-term reversals.
Looking beyond 2025, Lee believes the convergence of artificial intelligence and blockchain could define the next growth phase for digital assets. He pointed to a wave of corporate partnerships and AI-driven blockchain analytics as examples of how the industry is evolving beyond speculative trading.
In his view, Bitcoin and Ethereum are now entering a “maturity phase” – one where their value is increasingly derived from integration with real-world infrastructure rather than market hype.
If his projections hold true, the end of 2025 could mark not just a price breakout for crypto but a broader shift in how digital assets are perceived within global finance.
