Fundstrat's Tom Lee believes bitcoin is a legitimate investment for the younger generation.

"I think as a store of value, bitcoin makes a lot of sense," Lee said Thursday on CNBC's "Squawk Box." "I think the advantage is bitcoin is uncorrelated to stocks, bonds and gold. ... It is actually good diversification."

The strategist said acceptance of cryptocurrencies as an investment is no different than previous generations adopting gold and baby boomers helping to drive the stock market rally in the 1990s.

"The millennials in the U.S. are driving this adoption and recognition that blockchain and bitcoin and sort of digital businesses is going to be a real asset class," he said.

On Nov. 22, Lee the price of bitcoin would rise to $11,500. At the time, it traded at roughly $8,000. The digital currency is trading at $16,410 Thursday, according to industry website CoinDesk.