Amid widespread caution, Tom Lee has maintained his optimistic stance. He argues that the market has overestimated the disruptive impact of Trump's policies, underestimated the ongoing potential of the AI revolution, and overlooked Ethereum’s potential as a 'tokenization foundational layer'—this strategist, who has accurately predicted previous bull markets, has once again issued forward-looking insights.
When Wall Street repeatedly issued cautious warnings, he firmly told investors to buy. When the shine of cryptocurrencies dimmed, he predicted that Bitcoin would surge to $100,000. When Ethereum was nearly abandoned by the market, he asserted that it was still in a 'super cycle.'
For years, Tom Lee, Wall Street's most vocal bull, has been dismissed by critics as overly optimistic. But to the dismay of these critics, his predictions have often been validated by the market.
This year, which has seen strong performances across U.S. equities, overseas stocks, bonds, cryptocurrencies, and gold, among nearly all asset classes, Tom remains optimistic.
As the co-founder of research firm Fundstrat Global Advisors and chairman of BitMine Immersion Technologies Inc., Tom is renowned for his bold and accurate market forecasts. Even after BitMine’s stock experienced a significant decline, he further solidified his reputation in 2025 as one of Wall Street’s most prescient and influential figures. Tom has consistently advocated for investors to hold onto equities and other risk assets, earning him a spot on MarketWatch’s list of 25 people reshaping how we live, work, consume, save, and invest.
In a recent interview with MarketWatch, Tom systematically elaborated on observations about this year’s market misjudgments, predicted further upside potential for stocks, expressed skepticism about claims of an 'AI bubble,' and shared his bullish stance on cryptocurrencies.
Tom believes that investors' biggest misjudgment in 2025 was viewing Trump’s policies as 'uncertain and unpredictable' and assuming that they would harm the stock market. He pointed out that the market particularly misinterpreted April 2, referred to as 'Liberation Day,' when Trump announced sweeping tariff increases, triggering escalating fears of a trade war that could lead to inflation and push the world’s largest economy into recession.
“During that sharp market downturn, it should have been an excellent opportunity for investors to buy the dip, but many instead turned structurally bearish, missing one of the most important opportunities of the past five years,” Tom said. “I believe this was the biggest mistake people made this year.”
Although the market crash following April 2 pushed major indices into or near bear market territory, U.S. equities rebounded surprisingly quickly. By the end of May, all three benchmark indices had recovered their losses—after Trump announced a 90-day suspension of targeted high tariffs on most countries, reversing the trade war policy and causing market volatility.
Admittedly, the high volatility made buying stocks or deciding when to bottom-fish challenging for most investors. However, those who persisted were rewarded handsomely this year, as the rapid recovery of the stock market once again benefited those who stayed the course.
Since then, the US stock market has continued to stage what appears to be an unstoppable record-breaking rally. According to FactSet data, from the low point on April 8 to early November, the S&P 500 Index has risen by 35%, the Dow Jones Industrial Average has climbed by 25%, and the Nasdaq Composite Index has surged over 50% during the same period.
Tom also pointed out that investors have become 'overly sensitive' and tend to 'overreact' to concerns about inflation driven by tariffs, whereas the Federal Reserve views it as a 'temporary phenomenon'—allowing the market to overlook the short-term risks of surging inflation.
'The rebound in inflation does not mean that the Fed must adopt structural tightening,' Tom said, noting that this misunderstanding has kept many investors from turning bullish even after the Fed resumed rate cuts in September.
Inflation in the United States has remained persistently high so far this year, with consumer prices rising 3% year-on-year in September, marking the highest level since January and surpassing the 2.9% recorded in August. Labor Department data shows that core inflation, excluding volatile food and energy prices, also rose by 3%.
The Fed's dual mandate—achieving price stability and maximum employment—requires careful balancing, as inflation and labor market conditions often do not move in sync. In fact, the US economy is currently grappling with both a cooling labor market and stubborn price growth, presenting policymakers with a challenging situation, despite an increasing policy focus shifting toward employment risks.
Further upside potential remains for US stocks this year
Even after a nearly 16% cumulative rise this year, Tom and his team still expect the S&P 500 Index and the broader stock market to continue climbing through the end of the year. He highlighted favorable seasonal patterns and the Fed’s ongoing monetary easing as key factors supporting the upward trend.
According to data compiled by Carson Group, the fourth quarter is historically the strongest period for US stocks, with the S&P 500 Index posting positive returns 80% of the time since 1950, averaging a 4.2% gain. Meanwhile, strong performance in the first nine months of the year often signals further gains in the final three months.
At the end of October, the Federal Reserve voted to lower the target range for the federal funds rate by 25 basis points to 3.75%-4% and officially announced that it would halt balance sheet reduction starting December 1. However, Fed Chair Powell cautioned investors against expecting another rate cut in December, stating that it was 'not a foregone conclusion.'
As a result, investors have scaled back expectations for a December rate cut. According to the CME FedWatch tool, pricing from federal funds futures traders indicates a 72% probability of a December rate cut, down from 90% before the October policy meeting.
Tom also noted that the average negative sentiment in the stock market could become a tailwind for equities, creating opportunities for investors willing to adopt a contrarian stance.
"Market sentiment has averaged negative this year, with the difference between long and short positions standing at -11.7 so far in 2025. Historically, double-digit average sentiment readings only occur during bear markets, demonstrating how skeptical investors are of this bull market that they remain committed to a bearish stance," he pointed out.
Investor sentiment is often viewed as a contrarian indicator for the stock market, implying that acting against herd behavior may present favorable opportunities. Extreme bullish sentiment frequently signals potential downturns; conversely, extreme bearish sentiment may serve as a buying signal.
However, current stock market sentiment is not at either a bearish or bullish extreme. The latest survey by the American Association of Individual Investors shows that retail bullish sentiment is actually on the rebound.
Tom's accurate forecasting dates back to the pandemic era. In March 2020, when the COVID-19 outbreak escalated into a global health crisis and triggered a stock market crash, Tom advised clients to buy stocks and accurately predicted a sharp rebound. After 2022 proved to be an exceptionally bleak year, with most peers forecasting a recession or continued market decline, he was one of the few strategists on Wall Street to correctly predict the 2023 bull market. That rally kicked off an unusually strong three-year bull run.
He currently expects the S&P 500 Index to reach 7,000 points by year-end, representing a 4% upside from its closing level of 6,728.80 on November 7.
Concerns About an Artificial Intelligence Bubble and Cryptocurrency Collapse
This year's robust stock market rally, driven by dizzying enthusiasm for artificial intelligence, has prompted many warnings about a potential bubble. However, drawing comparisons to the internet era, Tom argues that NVIDIA Corporation's (NVDA) valuation is 'far more reasonable' than Cisco Systems Inc.'s at the peak of the dot-com bubble.
FactSet data shows that Cisco's forward price-to-earnings (P/E) ratio exceeded 131 times in March 2000, while NVIDIA, the darling of AI, traded at a forward P/E ratio of 30.43 as of November 7 this year. According to Dow Jones Market Data, NVIDIA became the first company in history to surpass a $5 trillion market capitalization last month.
"I agree that lower valuations are better, but I don't think an expensive market means there's no room for upside," he said. "When everyone is shouting about a bubble, the market is never actually in one."
Beyond macro markets, Tom's cryptocurrency insights continue to stand out uniquely.
Years before cryptocurrencies became mainstream, he had established himself as one of Wall Street’s earliest and most vocal Bitcoin bulls, providing clients with formal research reports at a time when the world’s leading cryptocurrency was dismissed by many as a passing fad.
Having now experienced a complete cycle, Tom has moved beyond an analyst role into practical implementation, personally taking on an executive position at a cryptocurrency company in 2025, allowing him to directly benefit from cryptocurrency appreciation.
In June, Tom assumed the chairmanship of BitMine Immersion Technologies, steering this publicly listed Bitcoin mining firm toward a broader cryptocurrency strategy that now includes purchasing Ethereum. According to a press release, as of November 10, BitMine holds 3.5 million Ethereum tokens, with total cryptocurrency and cash holdings valued at $13.2 billion, making it the largest institutional holder of Ethereum and the second-largest cryptocurrency reserve company after Strategy Inc.
BitMine stated that these substantial holdings account for approximately 2.9% of Ethereum’s circulating supply, and the company has set a long-term goal of acquiring 5% of the circulating Ethereum.
However, the company also faces challenges. After a surge in share price following Tom’s appointment, the stock has since retreated significantly amid market concerns that holding large amounts of cryptocurrency makes its shares highly sensitive to volatility in the digital asset market.
Following a sharp rise in July, BitMine’s stock price plummeted, recently falling 70% from its peak. Nevertheless, the stock is still up about 400% cumulatively in 2025.
Despite this, Tom believes that Ethereum has greater upside potential compared to Bitcoin and is confident that Ethereum will outperform Bitcoin in the coming years.
“Ethereum differs from Bitcoin because it is a smart contract platform that supports programmable transactions and can store vast amounts of information,” Tom noted. In contrast, he said Bitcoin is more akin to gold—a purer, inert store of value.
According to CoinMarketCap data, Bitcoin currently has a market capitalization of approximately $2.1 trillion, more than five times Ethereum’s market cap of $417 billion.
Tom and other proponents argue that Ethereum, as a dynamic digital ecosystem, drives smart contracts, decentralized finance, tokenized assets, and digital identity infrastructure. Among various applications, stablecoins pegged to assets such as the US dollar have become the first widely adopted significant use case, with most stablecoin activity occurring on the Ethereum blockchain.
But Tom emphasized that this is just the beginning. “Wall Street is now exploring how to tokenize stocks, bonds, and even real estate,” he said, bringing traditional financial assets into the same programmable ecosystem.
“Ethereum is becoming the new foundational layer for this tokenized future,” Tom concluded. “It is currently undervalued, which means that products built on Ethereum will create more value, and therefore, its performance is expected to outperform Bitcoin in the coming years.”
