Fundstrat’s Tom Lee told attendees at Binance Blockchain Week that he believes the worst of the recent crypto downturn is probably over and the market may be ready for a gradual recovery. He cited easing selling pressure and an increase in underlying economic activity as reasons for cautious optimism.
Market sentiment may be nearing a tipping point
Mr. Lee said the mood on the market had turned dark since October, with many investors tired of the steady losses. He said the current sell-off is more like an exhaustion than the start of another deep decline. Trading desks have scaled back operations. The volume has become thinner. Sentiment is low. Lee argued that in many cases, when pessimism reaches its peak, conditions for a reversal begin to form.
Bitcoin drawdowns are not uncommon
According to reports, Bitcoin has fallen about 36% from its all-time high in the recent pullback. Drops of this magnitude have occurred in previous cycles, such as 2017 and 2021, and have since continued to rise to new record levels.
“Cryptocurrency prices have probably bottomed out. The best growth period is yet to come. We expect 200x adoption in the future.” – Bitmine Chairman Tom Lee pic.twitter.com/fPWbWdaosO
— Binance (@binance) December 4, 2025
Lee pointed to the long-term gains of Bitcoin and Ether compared to some traditional assets over the past decade, saying the gains for cryptocurrencies were greater. He used that history to support the idea that patient retention was being rewarded after past stress.
Tokenization could become a big topic in 2026
Lee also discussed tokenization as an important theme for the future. He said that as major institutions prepare to move more financial products on-chain, and real estate joins in the transition, nearly $10 trillion in assets could eventually be tokenized.
Stablecoins were cited as an early example of why tokenized products could attract demand. He suggested that broader institutional efforts could increase stable interest in the market over time.
BlackRock's Bitcoin ETF attracted attention as a signal
According to reports, BlackRock's Bitcoin ETF has become one of the company's highest fee-earning products, a fact that Lee previously signaled increased involvement from Legacy Finance. He argued that the participation of these types of institutions signals the growing involvement of major corporations, which have previously been on the sidelines.
Introduction gap suggests large upside
According to Lee, only 4.4 million Bitcoin wallets hold more than $10,000 in BTC, but nearly 900 million people worldwide have more than $10,000 in retirement savings.
He argued that this gap shows how nascent the market is, and that if just a fraction of savers put their money into Bitcoin, adoption could increase by up to 200 times. He acknowledged the numbers were speculative, but said he used them to indicate the potential scale of future demand.
What this means for investors now
Lee questioned whether the old four-year cycle should be used as a strict guideline. He suggested that recent movements were driven by deleveraging and structural changes rather than the halving rhythm that shaped previous cycles.
Featured image from Unsplash, chart from TradingView
