Crypto bull market is back, Fundstrat's Tom Lee says, with Ether at $50,000 possible

The crypto market has moved past winter and entered a full bull market again, according to Fundstrat's Tom Lee, who said tokenization and institutional participation could make the current cycle much larger than earlier rallies.

In an Oct. 13 local-time Fundstrat interview, Lee said the market had returned to a full-blown bull phase and that much of the change in blockchain and crypto is taking place in Asia.

Lee said the past 12 months had been a grind for crypto, but the tone of the market had shifted. Tokenization and banks' adoption of blockchain are advancing in Asia, he said, making the region the right place to be.

He said traditional financial institutions often miss disruptive change. Banks are focused on retaining older wealthy clients, Lee said, while future demand is being shaped by younger users who see markets differently.

Lee described the liquid-asset market as at least $200 trillion and said it is growing by about $7 trillion a year. That new capital is looking for places to invest, he said, and the key task is to show that moving assets onto blockchain can outperform traditional wealth allocation.

He pointed to private equity and private credit as major targets for tokenization, saying tens of trillions of dollars are tied up in illiquid vehicles. At the same time, Lee said the crypto industry needs to look more mature, with investors confident that their funds are secure and will not disappear through hacks.

On AI, Lee said he does not view the current market as a bubble. He argued that when many investors already believe something is a bubble, they are less likely to create one.

He compared the AI cycle with the internet and mobile buildout, saying internet and mobile infrastructure cost about $35 trillion in 2026 dollars, while AI infrastructure spending is about $30 trillion. Lee likened today's AI cycle to the internet market around 1997 and said a bubble peak could come around 2033.

Lee said Fundstrat has focused on Ethereum because it could become the settlement rail of the future. He described Ethereum as the most neutral infrastructure, citing the size of its developer community and its operating record.

His price view was also bullish. Lee said Ether has been broadly stuck near the same level for five years and that the longer the base, the bigger the breakout. In this bull cycle, he said Ethereum could reach $25,000 or $50,000 per token.

Asked about year-end prices, Lee said Ethereum should exceed its all-time high and trade above $5,000. If Bitcoin is above $100,000, he said, Ether could be around $7,500.

Lee said the current cycle differs from earlier retail-led rallies. The 2016-2017 bull market was driven mainly by ICOs, while the 2019-2021 cycle centered on NFTs; this time, he said, institutions are building products and real innovations are emerging.

He cited liquidity, lower transaction costs and information access as advantages of tokenization. Lee said structures that allow investors to trade Waymo stock within Google, Starlink within SpaceX or full self-driving within Tesla could expand the market.

Tokenization is not just about putting assets on blockchain but about disrupting the functional services of banks, Lee said. Asset managers can embrace it because their fee model is based on assets under management, but institutions that earn from capital charges, trust functions or insurance elements may face significant risk.