Macro Factors Driving Bitcoin Past $13,000, Tom Lee says it’s “Caviar for Hedge Funds”
- As BTC smashes $13k, Bitcoin bull and Fundstrat’s Tom Lee explains the factors behind this surge
- Silicon Valley venture capitalist Chamath Palihapitiya says BTC is the “single best hedge against the traditional financial infrastructure”
Bitcoin has smashed the $13,000 level yet again. After dropping down to $9,600 on July 2nd, the leading cryptocurrency has been making its way upwards that today took over $13k, last hit on June 26.
BTC is currently up about 5 percent at $12,957 while managing the daily trading value of $2.23 billion.
Bitcoin price rallies to $13,150, Source: TradingView
So, what’s driving the price of Bitcoin?
According to Bitcoin bull and Fundstrat’s Tom Lee, there are multiple reasons for this spike.
While speaking to CNBC’s “Power Lunch” panel, Lee said Bitcoin is becoming increasingly attractive to institutions, especially hedge funds, given the fact that BTC is up over 252 percent till date in 2019.
He explains how adding just 2 percent of BTC to the portfolio at the beginning of the year would have added 400 basis points, which is “caviar for hedge funds.”
Fundstrat Global Advisors' Thomas Lee shares his take on Bitcoin's rally pic.twitter.com/bQ0nIFssSW
— Power Lunch (@PowerLunch) July 9, 2019
Facebook and other companies creating their own digital currencies are also the driving factors behind the bull rally, according to Lee, who says it means cryptocurrencies are here to stay.
Macro Factors in Play
Lee then points out how Bitcoin is gaining momentum as a store of value for people in China and Turkey who have turned to BTC because of their local economic risks.
LocalBitcoins in Hong Kong recently saw a spike in volume while local exchanges are recording premiums on BTC in the midst of a protest against the government. As Turkey’s Lira plunges, Bitcoin is hitting new all-time highs against the fiat currency. Bitcoin is being widely recognized as a store of value.
Single Best Hedge against Financial Infrastructure
Silicon Valley venture capitalist Chamath Palihapitiya, an early Bitcoin investor also called it a hedge against financial infrastructure.
“It’s the single best hedge against the traditional financial infrastructure. Whether you support the fiscal and monetary policy or not, it doesn’t matter. This is the schmuck insurance you have under your mattress,” Palihapitiya said.
Just recently, Deutsche Bank revealed its plans to cut down ~18,000 jobs which sparked commentators to observe that unlike cryptos, banks remain “built for the old world.”
With these factors in play, Lee concluded that Bitcoin’s “new all-time highs” are now “imminent.”
Bitcoin’s price is $45,857.15 BTC/USD exchange rate today. The real-time BTC market cap of $858.07 Billion currently ranks #1 with a chart dominance at 62.37%, daily trading volume of $26.2 Billion and live coin value change of BTC -3.02 in the last 24 hours.