Sean Farrell (Fundstrat) stated that the difference in perspective with Tom Lee stems from different research frameworks and client objectives: Farrell focuses on portfolios with a high proportion of cryptocurrency (around 20% or more) and a more proactive operating strategy to outperform the market across multiple cycles.
He highlighted Tom Lee's approach toward large asset managers, who typically allocate 1%–5% to BTC and ETH, prioritizing discipline and a long-term vision. Farrell also cautioned that the market is currently priced almost perfectly but still faces significant macroeconomic risks.
- Fundstrat has multiple independent analysts, research frameworks, and investment timeframes.
- Tom Lee serves the BTC/ ETH allocation group at 1%–5%; Farrell serves the cryptocurrency allocation group at approximately 20%+ and actively rebalancing.
- Farrell predicted a possible decline in the first half of the year, but still expects BTC and ETH to reach new highs before the end of the year.
Strategic difference: 1%–5% customer base versus 20%+ cryptocurrency market share.
Farrell stated that the difference in perspective with Tom Lee reflects the client base and portfolio management approach: 1%–5% BTC/ ETH is geared towards long-term gains; 20%+ cryptocurrencies are geared towards proactive rebalancing to outperform the market.
He stated that Fundstrat has multiple analysts, each with their own independent research framework and investment timeframe, to meet the objectives of different client groups. Farrell's research focuses on portfolios with a high proportion of Cryptoasset and employs a relatively more aggressive market-driven strategy.
Meanwhile, Tom Lee's research primarily caters to large asset management firms and investors who allocate only 1%–5% of their assets to BTC and ETH. According to Farrell, this type of strategy requires high discipline and a long-term perspective to grasp structural (long-term) trends and seek superior returns over time.
Short-term risks, expectations of a new peak before the end of the year.
Farrell assessed the market as being almost perfectly priced, but risks remain; the base scenario from earlier in the year could see a pullback in the first half, before creating opportunities for positioning towards the end of the year.
He said the cautious stance in the first half of the year was for risk management, not outright pessimism. The risks cited included the possibility of a government shutdown, trade volatility, uncertainty over AI Capital , and a potential change in the Fed chairman. He also noted the narrowing spread on high-yield bonds, low intermarket volatility, and recent divergence in fund flows.
Farrell stated that Bitcoin's current valuation is in unprecedented territory. In the long term, ETF demand may improve as major brokerage firms participate; however, in the short term, it remains under pressure from early sell-offs by holders, pressure from Miners, the possibility of MSTR being removed from the MSCI index, and fund buybacks ( Capital withdrawals). Nevertheless, he expects Bitcoin and Ethereum to challenge new all-time highs before the end of the year.
