Tom Lee — Wall Street’s resident cryptocurrency bull and a managing partner and research director at Fundstrat — is hailing 2018 as the year of the “Great Crypto Rotation.” He predicts there will be very pronounced cyclical rotations between “small cap” and “big cap” projects over the next 12 months.
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Short-Term Rally Coming?
During recent comments to the press, Fundstrat’s Tom Lee argued that most “small cap” coins — cryptocurrencies or tokens outside of the top 10 crypto projects by market capitalization — were up over 300 percent over the past 12 weeks, and that a massive rotation was due accordingly.
“We think 2018 is going to be a story about rotation. But the rotation we’re referring to is among the smaller altcoins and the large platform tokens,” Lee said.
As such, Lee suggested it was the powerhouse projects’ turn to win next:
“That [dynamic] generally marks a peak and then we start to see rotation into large cap-quality tokens. We’re starting to see this move into the top 10 tokens and that should actually help large caps rally.”
Lee: “Upside” in Altcoins
Lee is no bitcoin hater to be sure, as he predicted in the same interview that the bitcoin price could reasonably hit $25,000 USD by year’s end.
But, in referring to gaining altcoins — specifically to smart contracts platforms and Ethereum-competitors like NEO and EOS — Lee thinks there’s simply much more room to grow.
“There’s just a lot more potential, right? […] In some ways, if we look at NEO and its development, it looks a lot like Ethereum did at the start of 2017. So there’s a lot of potential for NEO, the NEOs and even EOSs, to do quite well.
I actually think the easiest use case for cryptocurrencies actually is store of value today, which is bitcoin, but I think that financial corridors are obviously very obvious use case, and I think that’s what these tokens are addressing.”
Taken altogether, then, 2018 is shaping up to be a strong year for daytraders who play the swings between altcoins and “big cap” projects like bitcoin.
What’s your opinion? Will you be doing any trading in 2018, or are you a hodler no matter what? Let us know in the comments below.
Images via CNBC, Steemit