Tom Lee Predicts Strong Crypto Rally by End-2025 on Low Leverage, Deleveraging and Institutional Support
Fundstrat research director Tom Lee predicts a strong crypto rally by the end of 2025, driven by record-low open interest and recent market deleveraging. After the October 10 unwind—the largest in five years—Bitcoin fell just 3–4%, highlighting its resilience, while Ethereum’s on-chain activity surged with Layer 1 and Layer 2 stablecoin integrations.
Technical indicators now show oversold conditions and rising relative strength, creating favorable entry points for traders. Lee also cites growing institutional adoption, including JPMorgan’s acceptance of crypto as collateral and BlackRock’s planned digital asset fund, as catalysts for renewed demand. Coupled with anticipated Fed rate cuts, these factors set the stage for a sustained crypto rally into late 2025.
Traders should watch technical rebounds, low leverage ratios, and institutional flows for opportunities ahead.
Bullish
This news is bullish for both short-term and long-term market behavior. In the near term, record-low leverage and oversold technical indicators suggest limited downside and a high probability of a rebound as traders capitalize on the reduced risk environment. Bitcoin’s minimal drawdown and Ethereum’s network activity surge reinforce buying confidence. Over the longer term, growing institutional adoption—highlighted by JPMorgan’s collateral decision and BlackRock’s digital asset fund—and the prospect of Fed rate cuts are likely to drive sustained capital inflows into cryptocurrencies, supporting a robust rally into late 2025.