Bitcoins current ”fair value” is between $13,800 and $14,800
This comes in a recent note to investors delivered this Thursday. In it, Lee expanded on his reasoning, and suggested a more ”fair” valuation of Bitcoin would put its price somewhere between $13,800 and $14,800.
Moreover, Lee did not merely snatch this number out of thin air. Rather, this valuation reportedly stems from the number of active wallet addresses, usage per account and other factors influencing supply.
Nevertheless, those keeping an eye on the cryptocurrency markets will know that Bitcoin’s current price is significantly below these levels. Rather, Bitcoin is trading at around $3,303 at the time of writing.
However, Lee partly explained this discrepancy between his ”fair” price projection and the market price with last year’s meteoric rise. This, coupled with a wider macroeconomic ”meltdown” is what Lee attributes Bitcoin’s price fall to.
However, he also mentions accelerated treasury sales in conjunction with initial coin offerings as exacerbating the issue.
”In fact, working backwards, to solve for the current price of Bitcoin, this implies crypt wallets should fall to 17 million from 50 million currently,” Lee stated in his note.
Furthermore, Lee said that there are several factors that paint a hopeful picture for the price of Bitcoin. He argues that one of the key drivers for the future price of Bitcoin will be mass adoption of the cryptocurrency, and subsequent acceptance of it as an asset class.
The fair price of Bitcoin could reach $150,000 per coin
This is hardly a controversial standpoint, as most cryptocurrency observers will probably agree that mainstream adoption is the major hurdle to clear. However, Lee went further and suggested that the future ”fair” price of Bitcoin could be as much as $150,000 per coin.
Specifically, Lee foresees this as happening once Bitcoin wallets account for 7% of the 4.5 billion Visa account holders. Lee is known for making bullish predictions on Bitcoin, and most recently for vigorously expressing optimism for a Bitcoin recovery.
Lee is increasingly comparing the number of active cryptocurrency wallets to that of Visa and MasterCard accounts. Moreover, the cryptocurrency sector has a comparatively meager 50 million active wallets. This pales in comparison to Visa and MasterCard’s 4.6 billion accounts, or even PayPal’s 254 million accounts.