Widely followed cryptocurrency analyst Thomas Lee’s short-term market forecast may not have materialized, but he’s sticking with his bullish long-term prediction despite the setback. If anything, Fundstrat Global Advisors’ Lee is digging in his heels even further, reportedly reiterating his forecast for a $25,000 BTC price by year-end.

What Happened

Lee placed a great deal of stock in last week’s Consensus conference, having said that a combination of a “sanity check” among market participants that innovation on the blockchain isn’t slowing down coupled with “new interest” should have been a catalyst for market gains. Instead, the broader cryptocurrency market shed about 10%. He told CNBC: “Clearly, we were too optimistic.”

Lee’s predictions till now have been unfolding like clockwork, including the tax-selling pressure that he rightly called was weighing on the bitcoin price through much of the first quarter of 2018. But perhaps it was too high an expectation to put on any conference, despite the strong turnout.

Last week’s blockchain extravaganza was a single event that most assuredly stirred curiosity about the market among newcomers, if only for the Lamborghinis that were parked outside in Midtown Manhattan. But that doesn’t necessarily mean that investors will or should make any sudden decisions to invest. If anything, perhaps attendees are researching cryptocurrencies further now that the market is on their radar and they understand it better.

What Fundstrat’s Lee apparently didn’t factor in, however, was the reticence on the part of institutional investors to enter a market whose regulatory clarity is murky. It’s not that he anticipated a fully regulatory framework by Consensus, but he admitted on CNBC the regulatory tilt was slightly negative.

“Crypto still faces significant internal resistance and hurdles within traditional financial institutions. But it is encouraging, nonetheless, that a large share of incremental attendance are financial institutions,” according to Lee.

Custody, Regulation and Price Targets

Hindsight, of course, is always 20/20, and Fundstrat’s Lee looking forward. But he says that “it’s going to take time” for key developments to unfold, which in addition to more regulatory clarity includes greater custodial support before the institutional capital will come off the sidelines. Consensus, despite its ability to rally the markets, “was a success,” he said, and it did reveal some custodial partnerships, such as Japanese bank Nomura taking on the role as custodian.

Fundsrat’s famous Bitcoin Misery Index (BMI), which reflects the way that people are emotionally feeling about the leading cryptocurrency, currently hovers at about 30 on a scale of 1-100, which Lee says “is good news” because only last month it was at 18. Fundstrat actually tracks 16 cryptocurrencies in that index, and bitcoin’s score is the lowest among them while EOS is at the highest emotional level.

Lee is “absolutely” sticking to his outlook for $25,000 bitcoin by year-end, saying: “We have to keep in mind … bitcoin at $8,000 and bitcoin at $25,000 …. it doesn’t require bitcoin to go up every day till the end of the year,” he told CNBC.

Indeed, as Lee has pointed out previously, bitcoin historically achieves all of its gains across the 10 top trading days of the year.

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