Wall Street oracle Tom Lee bets on Ethereum: Why does he firmly believe that ETH will soar past $10,000?

Tom Lee's name resonates throughout the financial world, hailed as the "Wall Street Oracle," having gained widespread attention for his precise market predictions and deep insights into technology stocks, Bitcoin, and other assets. As the founder of the analysis firm Fundstrat, he is both a well-known analyst in traditional markets and a staunch supporter of digital assets like Bitcoin (BTC) and Ethereum (ETH). Recently, Lee was appointed as the chairman of the board for the mining company Bitmine Immersion Technologies (BMNR) and is involved in the company's launch of a $250 million Ethereum treasury strategy, attracting significant market attention. In external interviews, he boldly predicted that Ethereum would rise to $10,000 during the current market cycle.

Bitmine announces a 250 million Ethereum treasury strategy, appointing Tom Lee as chairman of the board

Mining company Bitmine Immersion Technologies (BMNR) recently announced a $250 million private placement plan aimed at funding its Ethereum treasury strategy, a move similar to Strategy's (formerly MicroStrategy) adoption of a Bitcoin treasury strategy. On July 3, Bitmine's stock surged over 1,000%, sparking enthusiastic discussions and speculation among investors. This fundraising is led by MOZAYYX and supported by some active institutions in today's crypto investment scene, including DCG.

At the same time, Bitmine also announced the appointment of Tom Lee as chairman of the board. Lee is the founder of Fundstrat and a well-known strategist who has long been optimistic about cryptocurrencies. His early strong belief in Bitcoin and tech stocks has earned him a loyal following on Wall Street.

Despite the surge in stock prices drawing widespread attention, it also comes with warnings. Analysts point out that while the crypto treasury strategy is a powerful narrative driver, it also brings new volatility risks. The future of Bitmine will be closely tied to the trends of Ethereum, and in this field, sentiment can change very quickly. For investors optimistic about the long-term application of Ethereum, direct investment may be a simpler and less volatile option.

Tom Lee: Ethereum is the direct beneficiary of real-world asset tokenization

Tom Lee stated in a recent interview that he likes Ethereum because it is a programmable smart contract blockchain, and the rise of stablecoins is the reason supporting Ethereum. He mentioned Circle, a recently popular stablecoin listing company, valued at $9 billion. "Circle is like the best IPO in five years, and its trading market value is 100 times EBITDA, which has brought very good performance to some funds, helping them enter the top 1%."

Lee pointed out that this indeed proves that Wall Street is trying to endow tokenized assets with the properties of stocks, while the crypto world is tokenizing stocks because they have tokenized the dollar. People are now seeing that JPMorgan wants to launch its own stablecoin, and Amazon, Walmart, and Goldman Sachs are also following. Stablecoins are a very good business model and are very effective for consumers and merchants. But they all have to operate on the blockchain, and most stablecoin transactions occur on Ethereum.

"Ethereum was once overlooked. Currently, the total scale of the stablecoin market is only $250 billion, accounting for 30% of Ethereum's transaction fees, and Ethereum generates more than 50% of stablecoins each year. Treasury Secretary Scott, who is a big fan of stablecoins, believes this will be a $2 trillion market, or a growth of 10 times." Lee further pointed out that he believes Ethereum is the direct beneficiary of Wall Street's attempts to give cryptocurrencies stock-like properties.

Five Advantages of Treasury Strategy: Why is it Superior to Simply Buying Ethereum?

Talking about the "Tom Lee Effect" on the rise of BMNR stocks, Lee suggested that if one wants to invest in Ethereum, why not directly purchase an ETF, or why not buy it directly on the chain and hand it over to a custodian. He emphasized that, in fact, reserve companies have 5 very important aspects:

Increase the token amount per share: If people buy an ETF or purchase Ethereum on the chain, the units of Ethereum you hold will be fixed. However, these reserve companies aim to increase the token amount per share, and the benchmark for Strategy companies is this key performance indicator. If its trading price is higher than the net asset value (NAV), they can issue shares to create more net asset value per share, which is what they call reflective growth.

Lower capital costs: The underlying tokens are highly volatile, with Ethereum's volatility being twice that of Bitcoin. If people hold Ethereum ETFs and want to buy more Ethereum ETFs using leverage, banks can charge a fee of 10%. However, if you are at a treasury asset company, the capital cost is lower. Volatility can be sold through convertible bonds or derivatives. In the case of Strategy Company, the capital cost is zero, so you can now pull two leverages.

Merger arbitrage opportunity: There is a gap between the market price and the net asset value. Investors have equity, and there are other reserve companies also trading at net asset prices. So if something is trading at the net asset value price, and you trade at three times the price, you can engage in a merger and purchase other reserve companies. It's like arbitrage.

Create an Operating Business: You can create an operating company. For example, we can create a business that helps the DeFi ecosystem by providing Ether staking loans. This is not common in Bitcoin, but in fact, it is a huge advantage on Ethereum.

Sovereign put options: It is possible to create so-called structured put options. In the Ethereum world, because it is a staking token, if these reserve asset companies own 5% of Ethereum, they are very important to the ecosystem. Therefore, their market value should rise. If Goldman Sachs launches a dollar token that operates on Ethereum, they will ensure the security of the Ethereum network. So ultimately, they will purchase a large amount of Ethereum. But these staking entities already own it. So perhaps they will only purchase the rights of the staking entities. Thus, the staking entities hold Wall Street's put options, which is a very logical way of thinking.

Tom Lee's Early Experience and Macroeconomic Strategy

Looking back at Tom Lee's personal history, his original name is Thomas Jong Lee, and his parents are Korean immigrants. Lee earned a Bachelor’s degree in Economics from the Wharton School of the University of Pennsylvania, majoring in Finance and Accounting, and is a CFA charterholder. His career began in the early 1990s, working at Kidder, Peabody & Company and Salomon Smith Barney. In 1999, he joined JPMorgan as Chief Equity Strategist. In 2014, Lee left JPMorgan to establish his own research advisory firm, Fundstrat Global Advisors, and became the firm’s Head of Research.

Lee is the first major strategist on Wall Street to provide formal research on Bitcoin for clients, a move that garnered widespread media attention at the time. Lee is known for his deep insights into the market and accurate long-term forecasts. His analysis includes predictions for the S&P 500 index, views on market rebounds, and comments on specific stocks such as Strategy Company and Tesla. Additionally, Lee discusses the impact of inflation and Federal Reserve policies on the market.

Recently, he predicted that the S&P 500 index would rise by 10% in 2025 and believes that the current market rebound, while positive, has not yet garnered the trust of most investors. Although Lee has been criticized for his optimistic market outlook, his supporters highly value his institutional-level perspective and deep understanding of market trends.

Tom Lee has transformed from a "Wall Street oracle" into a bullish advocate for Ethereum. His firm optimism about Ethereum's treasury strategy is not only based on insights into the potential of the stablecoin market but also stems from his deep understanding of Ethereum as a foundational financial infrastructure. The five advantages of the treasury strategy he proposes provide new ideas for enterprise-level Ethereum asset allocation. Although Ethereum has been considered lacking in innovation, with the rise of tokenization of real-world assets, Tom Lee believes that Ethereum will experience a delayed breakthrough and could potentially hit $10,000. If Bitmine's strategy succeeds, the funding management model for ETH may not just be the next hot topic; it could also become the future of the cryptocurrency public market.