Bitcoin prices will probably climb after April 17, when Tax Day in the United States is over. That’s what Fundstrat co-founder Tom Lee, a noted bitcoin bull, predicts.

Lee said the recent drop in bitcoin’s price amid a flurry of sell-offs was partly caused by investors rabidly trying to sell off their cryptocurrency holdings to avoid paying taxes on them.

Bitcoin’s price has plunged below $6,700 today from its peak of $19,000 in December 2017. The top cryptocurrency by market cap has been decimated during the past few weeks amid an avalanche of negative news, including crypto advertising bans by Twitter and Google.

Email distribution platform MailChimp also joined the fray, banning cryptocurrency and ICO ads, citing the need to prevent “scams, fraud, phishing, and potentially misleading business practices.”

But Lee said the selling pressure will ease up once Tax Day passes. He estimates that U.S. bitcoin investors owe about $25 billion in capital-gains taxes for 2017, thanks to BTC’s soaring prices last year. Accordingly, the Internal Revenue Service has been trying to collect taxes on those crypto gains.

“The $25 billion would represent 20% of capital gain tax receipts (payments) to Treasury, which explains why the IRS cares so much about collecting crypto taxes,” Lee said in a note. “Total receipts for capital gains should hit a record $168 billion (for income tax year 2017), exceeding the $137 billion of receipts in 2007.”

Lee: Selling Pressure Will Wane

Tom Lee believes the selling pressure on bitcoin and accompanying price drops will calm down once Tax Day passes.

“Selling pressure for bitcoin should be alleviated after April 15th,” Lee said. Tax Days falls on April 17 this year because the 15th is a Sunday.

However, Lee cautioned that cryptocurrencies could remain under pressure if governments step up regulatory scrutiny.

“Regulatory headline risk is still substantial. And sentiment remains awful, as measured by our bitcoin misery index, which is still reading misery.”

It’s true that Lee’s Bitcoin Misery Index recently plunged to its lowest level since 2011. But that’s actually good news for crypto fans, because the misery index is a contrarian index. That means the lower it falls, the better a time it is to invest in BTC.

Good News! Bitcoin Misery Index Tanked

Lee said when the Bitcoin Misery Index drops below 27, bitcoin sees its best 12-month performance. Last month, the index was at 18.8 on a scale of 100. That’s abymal, which for Lee signals that it’s a good time to buy.

Lee said the last time the misery index cratered to such lows was in November 2012, September 2016, and January 2015. In each instance, bitcoin’s price climbed the following month, he said.

Here’s Fundstrat’s Tom Lee making case for bitcoin HODL-ing on CNBC:

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