OpinionEthereumBitcoin
|7 min ReadTom Lee and Arthur Hayes on Crypto’s New Power Map
Tariq Al-Saidi
Senior Analyst
Published
Jan 16, 2026
A new high, two big targets
Bitcoin printed a fresh all-time high of 250,000 Bitcoin, $10,000 ETH,” he said. Tom Lee matched the call. “By year end, our target for Bitcoin is 200 to 250,000. And for Ethereum, somewhere between 10 and 12,000.”
Seasonality and policy mattered to Lee. He liked seeing Bitcoin at records in early October, with the Federal Reserve easing. He called it confirmation, not froth. “There’s still room for upside into year end,” he said. ETH, he added, had based for four years and just broke out. A push to 12,000 would be big, but to him it was price discovery, not a blow off top. Very strong.
Bitmine’s fast climb and Wall Street’s rush
Lee came in not just as a forecaster, but as a builder. Bitmine, he said, went from 0.5 percent of ETH supply to about 2.25 percent in roughly 12 weeks after its late July closing. The stock is widely followed by the public and bought by large institutions. He cited Cathie Wood’s ARK funds as a top 10 holder. Trading has been wild. “It’s the eighth most traded options chain today,” Lee said, noting a 2x Bitmine leveraged ETF, BMNU, that also has options.
Hayes laughed at the leverage mania. He called leveraged ETFs “the most dog shit product ever” and told traders who want 2x to use futures instead. He knows the math. He built them in Asia years ago. Negative gamma eats capital. The bankers collect fees. The casino stays open.
Still, liquidity has concentrated at the top. “BitMine and MicroStrategy combined is 86 percent of all crypto trading volume of all the hundreds of DATS in the world,” Lee said. Hayes agreed on the power law. The top dogs take most of the real volume. The rest struggle. He warned the long tail will issue “stuff you’ve never even heard of,” with bankers charging 20 percent. It will end in tears for some. Traders will enjoy the ride.
The cycle debate: liquidity, credit, and politics
Everyone asks about the four year cycle. Hayes does not buy it. He walked through 2009 to 2013, 2013 to 2017, 2017 to 2021, and now. He mapped Bitcoin peaks to liquidity shifts. Fed funds, bank credit, QE and QT, and China’s credit impulse. Early Bitcoin rose on the back of post-GFC stimulus in the United States and a massive Chinese credit push. The first bubble popped as growth decelerated in 2013. The 2017 ICO wave rode Chinese credit expansion, then the Fed tightened and the bubble burst. The 2021 peak lined up with the Fed preparing to raise rates after COVID stimulus.
This time is different. The reverse repo cash that Treasury pumped into markets has run down, but rate cuts have started. The message from Washington is to run the economy hot. Housing is the lever. Mortgage rates may be pushed lower. China wants to stabilize housing and add credit. Hayes’s view is simple. No four year clock. We are in an extended cycle tied to policy. It ends when the Trump administration ends, or when investors fear a turn in 2027 to 2028. You do not have to like it. Markets will price it.
Lee largely agreed and added sentiment is still muted compared with 2017 and 2021. He wants crypto to make overtures to both parties. Policy should not flip with a new administration. Crypto is technology. It should not be partisan.
ETH as compute, Bitcoin as money
Hayes drew a bright line. “I view Bitcoin as money and I view ETH as compute.” He wants ETH compared with platforms like NVIDIA, Apple, Amazon. The backbone of the internet and AI. Let other tokens compare to ETH, not the other way around. Lee called the two complementary. Bitcoin is digital gold. Ethereum is an architecture for Wall Street and AI to build on. He compared it to 1971. Gold became the store of value as the dollar left gold. Wall Street built a synthetic dollar system and created enormous equity value. Both tracks won.
Bitmine wants to be part of the ETH buildout. Lee said they meet the Ethereum Foundation, core developers, and Vitalik. Bitmine aims to bridge market needs to the builders. It stakes. It invests. It allocates about 1 percent of its balance sheet, roughly $130 million, to projects. He used the word “kingmaker” then immediately downplayed it. The goal is to be digital infrastructure, a ballast for the network.
On targets, Lee said 5 percent of ETH supply was a waypoint, not a ceiling. Power laws suggest even 10 percent could be possible without disrupting the ecosystem. That is ambitious. ETH around $4,000 helped the pace. A fourth quarter rally will make every marginal percent more expensive.
Stablecoins, tokenization, and the great flippenings
Tether’s reported 10 billion in net income a year. He would rather pay a ski guide in Argentina with Tether than deal with a commercial bank outside New York. Emerging markets already get it. Every big market will have one or two Tether-like banks. The rest go to zero or get absorbed.
Lee said it checks out. The 177 billion of Tether in circulation and added that Bitcoin is at “2.5,” prompting Lee to say “Billion.” The point landed anyway. Hayes believes Tether supply can flip Bitcoin if Washington wants the dollar rails embedded globally. He sees deposits migrating from Eurodollar accounts to token dollars. Lee did the math from 2 trillion of supply. The value capture for the issuer would be huge. It is why crypto equities could surprise to the upside.
Tokenization runs through this story. BlackRock has ETFs and tokenization products. Stripe is building an EVM chain. Many institutions are now in crypto in a way they were not under the last administration. Lee wants the next step. He prefers tokenizing real companies to unlock value streams. He named NVIDIA’s China revenue and Blackwell sales as examples. Then hedge those streams with prediction markets tied to policy or rates. Beautiful and practical.
Perps, security, and the new finance culture
Perpetual swaps started in crypto. Do they go to TradFi. Lee said crypto products leak into the old world when they solve problems. Stablecoins proved that. Perps can move too. Hayes, ever the operator, said the U.S. is not just licensing. It is clearing. Only 14 designated clearing organizations exist. None awarded in decades. If a founder wants perps in the U.S., the battle is the clearing regime. Get that and you can list real leverage without killing your exchange in a volatility shock. Otherwise, build offshore.
Security talk flipped an old script. Ryan noted people used to hear about hacks in crypto. Vitalik recently wrote that DeFi capital losses are under 0.3 percent right now. Hayes pointed to the recent Bybit incident as a centralized implementation failure, not a public chain failure. Lee said losses from traditional ledgers and identity leaks dwarf what we see on hardened chains. Bitcoin and Ethereum have no recorded history of a blockchain breach. Public blockchains provide finality. Centralized systems create single points of failure.
Finally, there is culture. Prediction markets and Pump.fun are pulling attention and flow. Pollymarket called the 2024 election, Lee argued, showing real wisdom of crowds as long as the market does not reflexively sway outcomes. Hayes went deeper. Inflation and inequality push people into speculation. Markets reveal what people value and what governments have failed to deliver. It is a harsh read, but it rings true in many places. Very big. Very strong.
They ended where they began. Targets. Hayes stayed with 10,000 ETH by December 31. Lee said 250,000 for Bitcoin and 12,000 for ETH. If that happens, it will feel historic.
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