Bitcoin could quadruple in 2021 as the digital currency sees a rally similar to 2017, Fundstrat's Tom Lee says

Bitcoin's near 300% surge in 2020 could be followed up by an even stronger performance in 2021, according to Fundstrat's Tom Lee.
In an interview with CNBC on Wednesday, Lee said bitcoin could quadruple in 2021 as the crypto asset experiences a similar parabolic setup that occurred in 2017.
"2021 is going to be a lot like 2017 which means bitcoin should do even better in 2021 than it did in 2020, so something above 300%," Lee told CNBC.
Visit Business Insider's homepage for more stories.

Following a strong 2020 that saw bitcoin march to all time highs for a gain of around 300%, 2021 could be even stronger.

That's according to Fundstrat's Tom Lee, who said in an interview with CNBC on Wednesday that he sees bitcoin surging another 300% next year.

At its current price of about $29,000, a quadruple in bitcoin would put the crypto asset well above the $100,000 mark at $116,000.

Driving bitcoin higher would be a similar setup to what was seen in 2017: a parabolic rally. Lee tweeted that the halvening of 2020 makes this year most similar to 2016, which also experienced a halvening. A halvening in bitcoin is when the reward for miners completing problems on the bitcoin blockchain is cut in half.

2021 will be most like 2017 in that bitcoin will likely experience a "parabolic rise," Lee tweeted.

Fundstrat's digital asset strategist David Grider also raised his outlook for bitcoin in a note on Wednesday, expecting the crypto asset to hit at least $40,000 next year.

"We believe the conditions remain in place for a continued rally in bitcoin and crypto more broadly over the next 6-12 months. Institutional and corporate buying, regulatory de-risking and retail stimulus demand are factors that have led to an increase in positive momentum, which we believe can continue," Grider said.

But if the stock market corrects next year, the positive outlook for bitcoin may deteriorate, according to Lee.

"Bitcoin acts like a risk on asset, so in the years where the S&P performs the best are also the best years for bitcoin. So I think if we have a correction in stocks then bitcoin is going to fall," Lee explained.

Read the original article on Business Insider