Despite a mixed performance for cryptocurrency markets in 2025, Tom Lee, head of research at Fundstrat and chairman of Ethereum treasury company Bitmine Immersion Technologies, remains steadfast in his bullish outlook. In a recent interview on the Master Investor Podcast, Lee doubled down on his prediction that Bitcoin will reach $250,000 and set new all-time highs in 2026. He attributed the upcoming rally to the increasing usefulness of crypto technology, especially as traditional financial institutions begin to embrace blockchain infrastructure.
2025 Crypto Setback: A Temporary Liquidity Squeeze
Lee acknowledged that crypto’s relative underperformance in 2025 was largely a result of a severe liquidity crunch starting in October. Before October 10, digital assets were actually outperforming traditional markets, he noted. Then a crash wiped out roughly $500 billion in market capitalization and triggered billions in liquidations. “The lack of liquidity and institutional support remains a weakness,” Lee admitted. However, he stressed that this does not invalidate Bitcoin’s long-term structural bull case.
Three Catalysts Behind Bitcoin’s Next Leap
1. Banks Embrace Blockchain Settlement Finality. Lee pointed out that banks are increasingly recognizing blockchain’s efficiency in settlement finality, a feature that could revolutionize back-office operations. “Blockchain works really well for settlement finality,” he said, predicting that this recognition will funnel more capital into the crypto ecosystem.
2. Tether as a Model of On-Chain Banking. Lee highlighted stablecoin issuer Tether as a prime example of how blockchain-native financial services outperform their traditional counterparts. He noted that Tether is expected to generate nearly $20 billion in profits in 2026, placing it among the top five most profitable banks globally. By valuation, Tether trails only JPMorgan, and is roughly twice the valuation of Goldman Sachs or Morgan Stanley. Yet Tether operates with just 300 full-time employees, compared to JPMorgan’s 300,000. “They make more money than any bank and have less than 1% of the M1 money supply… yet it’s one of the most profitable banks in the world,” Lee said, adding that this proves the power of blockchain-based banking.
3. Growing Awareness of Crypto Utility. According to Lee, the primary driver for Bitcoin’s new highs will be a broad recognition of crypto’s real-world utility. From cross-border payments and decentralized identity to supply chain solutions, the technology is gaining traction beyond speculation. Lee believes this shift in perception will catalyze a massive reallocation of capital into Bitcoin and other digital assets.
Outlook: All-Time Highs Are Inevitable
Lee reiterated that Bitcoin’s path to a new all-time high is a matter of “when, not if.” He sees 2026 as the year when the “utility narrative” finally materializes in price action. Investors are advised to watch for developments in bank adoption, stablecoin growth, and Layer-2 scaling solutions as leading indicators for the next bull phase. While short-term volatility remains, Tom Lee’s conviction offers a compelling anchor for long-term Bitcoin believers.