Tom Lee: The Next 5 Years of Crypto Will Be About Ethereum
Speakers
Tom Lee
— Managing Partner & Head of Research, Fundstrat
Summary
Fundstrat's Tom Lee argues Ethereum is still vastly undervalued and that the next five years of crypto will be defined by Ethereum, tokenization, and AI agents moving finance onchain. He sees last week's crypto short squeeze as the start of a larger bull move and expects the ETH/BTC ratio to rise well above its prior 0.08 high. He also discusses Bitmine's weekly ETH accumulation toward 5% of supply and its new BMR buyback program.
- Tom Lee says crypto fundamentals are strengthening unlike prior crypto winters.
- He expects tokenization and AI agents to drive Ethereum adoption.
- He sees Ethereum as vastly undervalued even against its old $5,000 high.
- He expects the ETH/BTC ratio to rise at least to 0.08 and potentially far higher.
- He says Bitmine has accumulated over $14 billion of ETH targeting 5% of supply.
- He explains Bitmine's $4 billion BMR buyback authorization and buyback execution.
- He names catalysts including the Clarity Act, sidelined cash, and institutional performance chasing.
- He remains bullish on Bitcoin as digital gold with multiples of upside.
Ideas
Ethereum is vastly undervalued.
Ethereum L2s such as Base and Robinhood Chain are designed to rely on Ethereum's security and finality. Their tokenized stock and crypto trading success increases the need and desire to settle on Ethereum even if L2s themselves generate limited fees. Revolut's stablecoin also launched on Ethereum rather than Tempo, and Lee argues successful assets are increasingly valued as stores of value, which should change how Ethereum is valued.
ETH/BTC ratio should rise sharply.
The Ethereum/Bitcoin ratio is around 0.03 versus 0.08 at the 2021 highs. Lee expects it to rise at least back to 0.08 and potentially far beyond, maybe 0.25 or even 1, because tokenization and agentic AI are bigger drivers than 2021's meme and NFT activity. Catalysts include the Clarity Act, sidelined cash returning, Asian flows, and institutional performance chasing into year-end; at 0.04 with Bitcoin at 150,000, Ethereum would be around 6,000, which he considers conservative.
Bitmine buybacks show undervalued stock.
Bitmine introduced a $4 billion common equity buyback authorization, potentially enough to buy back 50% of the company, because management believes the stock was trading below fundamental value. Buying back shares grows Ethereum per share; the company bought nearly 20 million shares back under $15 and the stock is now $26, which Lee sees as a successful program and a good investment.
Bitcoin has multiples of upside.
Lee remains a very big believer in Bitcoin because it is better than digital gold and functions as a far better substitute for gold. He thinks Bitcoin easily has multiples of upside from here, even though Ethereum may outperform over the next five years on tokenization and agentic AI adoption.
