Fundstrat CIO Tom Lee has spoken out by experts on the recent stagnation of Bitcoin prices despite growing institutional demand.
Recently appointed chairman of Bitmine, Lee shared her thoughts on CNBC’s ETF edge on Tuesday after Bitcoin’s monthly start and start. The pioneering cryptocurrency fell to $105,159 on Tuesday, causing a broader market shaking, but at the time of writing it had revived $107,000.
Why Bitcoin prices are stagnating
The FundStrat CIO emphasized that the US Bitcoin Spot Exchange Trade Fund (ETF) is one of the most successful ETF launches in history. Investment vehicles have collectively attracted $48.6 billion since launch as demand for Bitcoin exposure reaches unprecedented levels.
Meanwhile, aside from the $342 million net outflow on July 1, Bitcoin spot ETFs were in a 15-day inflow streak, with the last outflow yesterday before it happened on June 6th. These inflows accumulated a net worth of $13.1 billion.
However, Bitcoin has not yet reached the moon from the influx as many people expect. Lee pointed out that one of the reasons behind this price stagnation could be the way these ETFs get influx.
Specifically, he pointed out that some of them may have received physical exchanges from customers who already own Bitcoin. This type of transaction involves moving Bitcoin from a cold wallet to an asset manager wallet, and no active purchases are required.
Lee called such a transaction “washing” and claimed that the price of Bitcoin would not move. In particular, Bitcoin prices follow a simple demand supply mechanism, and such transfers do not introduce new demand pressure. As a result, prices continue to be in range.
Retailers’ sales that neutralize institutional demand
Additionally, longtime Bitcoin proponents have denounced the stagnation of the price of Bitcoin OGs, sitting on massive profits. He highlighted early retailers who acquired crypto leaders at prices significantly lower than current levels were profitable.
“I don’t care if Bitcoin goes to 1 million people. They’re probably about 100,000 sellers.” Lee said.
As a result, this sales pressure has countered the demands from the institutions and slowed the price of Bitcoin. Interestingly, Bitise CEO Hunter Horsley previously shared similar sentiments. Highlight A possible reason for this bearish sentiment is that Bitcoin’s trend is around $100,000.
Horsley pointed out that individuals who make these profits will reconsider their disposal when Bitcoin gathers higher, perhaps $130,000-$150,000. At that price, he suggested that no one sell their bitcoin.
Meanwhile, Bitcoin continues to cover the highest ever-present range, specifically trading at $107,420. Previous analysis suggests that this new mainstream demand for BTC could raise prices to $200,000 by the end of 2025 and to $1 million by the end of this cycle.