(Bloomberg) -- It's hard to keep a Bitcoin bull down.
Back in May, Thomas Lee, head of research at Fundstrat Global Advisors was predicting a rally to $25,000 by the end of the year. And despite things not playing quite in his favor -- the cryptocurrency is currently trading below $3,400 -- he's sticking to his guns.
Bitcoin's fair value, given the number of active wallet addresses, usage per account and factors influencing supply, is between $13,800 and $14,800, he said in a note Thursday. His explanation for the divergence include last year's meteoric rally, a “meltdown” in the macroeconomic climate and treasury sales during initial coin offerings.
“Fair value is significantly higher than the current price of Bitcoin,” he wrote. “In fact, working backwards, to solve for the current price of Bitcoin, this implies crypto wallets should fall to 17 million from 50 million currently.”
Read More: Ranks of Crypto Users Swelled in 2018 Even as Bitcoin Tumbled
User adoption and Bitcoin's acceptance as an asset class are the key factors that will drive it higher beyond 2018. If Bitcoin wallets approach just 7 percent of Visa's 4.5 billion account holders, fair value would be $150,000 per Bitcoin according to his model, he said.
“We are tired of people asking us about target prices,” he said, declining to update his year-end forecast.
To contact the reporter on this story: Eddie van der Walt in London at evanderwalt@bloomberg.net
To contact the editors responsible for this story: Samuel Potter at spotter33@bloomberg.net, Dave Liedtka, Randall Jensen
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