Tom Lee stated that as long as the fundamentals continue to improve, it's only a matter of time before cryptocurrency prices rise.

Article author and source: Brand DAO

Tom Lee's core arguments under market fragmentation

At the start of 2026, the global financial market showed a clear divergence: gold and silver soared and repeatedly hit new historical highs, while mainstream crypto assets such as Bitcoin and Ethereum fell into a period of consolidation and their prices were relatively weak.

This stark contrast has confused many investors, and some have even begun to doubt the long-term value of crypto assets.

In response, Tom Lee, Chairman of BitMine and co-founder of Fundstrat Global Advisors, offered his unique perspective in a tweet, arguing that "the parabolic rise in gold and silver is masking the continued strength of the underlying fundamentals of crypto assets, especially Ethereum and Bitcoin," and mentioning that at the 2026 Davos Forum, financial institutions are accelerating the development of products on Ethereum and other smart blockchains.

In his view, as long as the fundamentals continue to improve, it's only a matter of time before cryptocurrency prices rise.

Market Appearances: The Precious Metals Frenzy and the "Illusory Calm" of Crypto Assets

The core driving force behind the rise in gold and silver prices

Since the beginning of 2026, the precious metals market has performed better than expected.

As of January 26, spot gold in London broke through the $5,000/ounce mark, up more than 17% from the end of 2025; spot silver rose even more rapidly, climbing to above $110/ounce at one point, with a year-to-date increase of more than 50%, showing a strong upward trend.

This surge was not accidental, but rather the result of multiple factors working together. On the macro level, heightened global geopolitical tensions fueled risk aversion, coupled with the Federal Reserve signaling continued interest rate cuts, providing strong support for precious metal prices.

Weaker-than-expected US economic data further highlighted the defensive nature of precious metals, attracting funds to these safe-haven assets.

At the same time, amid the wave of de-dollarization, the global trend of central banks buying gold has not diminished, the safe-haven premium of physical assets continues to rise, and gold's monetary attribute as a "dollar substitute" is becoming increasingly prominent.

From a funding perspective, the market is currently in a safe-haven asset allocation cycle, and precious metals are taking the lead in absorbing liquidity due to mature market consensus. The combination of rising short-term funding sentiment and structural supply shortages is further boosting prices, a characteristic particularly evident in the silver market.

In addition, the reflation expectations brought about by the general rise in commodity prices have also strengthened the anti-inflation value of precious metals. The resonance of multiple factors has contributed to this round of gold and silver bull market.

Short-term performance of crypto assets and market misunderstandings

In stark contrast to the frenzy surrounding precious metals, mainstream crypto assets entered a period of adjustment in early 2026.

As of late January, the price of Ethereum fluctuated around $2,900. Although Bitcoin maintained high-level fluctuations, its gains lagged significantly behind those of gold and silver, and the gap in market capitalization also widened further.

This weak performance has sparked numerous questions in the market, with voices constantly pointing to the failure of the "digital gold" narrative and the diversion of institutional funds to precious metals.

Some investors believe that crypto assets are far less safe than traditional precious metals, and the shift of institutional funds means that their long-term logic no longer holds true.

However, Tom Lee disagrees with this view, believing that the market has fallen into the trap of "emphasizing price and neglecting fundamentals," and that judgments are dominated by short-term sentiment.

In his view, the current weakness of crypto assets is merely a symptom; their underlying fundamentals have been continuously improving, but this change has been masked by the impressive gains in precious metals.

In fact, crypto assets combine technological and financial attributes, and their volatility is inherently higher than that of traditional assets. Their short-term trends are more easily affected by liquidity cycles and market sentiment, while their long-term trends are ultimately determined by fundamentals.

Distinguishing between short-term price fluctuations and long-term fundamental trends is key to understanding the current cryptocurrency market.

Core Support: Four Pillars of Continued Strength in Crypto Asset Fundamentals

Ethereum Technology Iteration: A Dual Breakthrough in Performance and Ecosystem

2026 is a pivotal year for the implementation of Ethereum technology, with multiple core upgrades being rolled out simultaneously to help it find a better balance between performance, privacy, and decentralization.

Among them, the ZK-EVM mainnet integration is a core highlight. Relying on zero-knowledge proof technology, it can compress the complex transaction verification process into a small verifiable proof, which not only improves transaction efficiency and reduces gas costs, but also allows ordinary users to independently verify blockchain data through their personal computers, reducing dependence on large-scale infrastructure.

The implementation of this technology effectively alleviates the long-standing pain point of Ethereum, which is that "decentralization and efficiency are difficult to balance," and lays a solid foundation for ecosystem expansion.

At the infrastructure level, Ethereum upgrades are progressing steadily: the Block Access List (BAL) lowers the hardware threshold for running nodes, and the new generation of light client Helios enables wallets to directly verify third-party service data, building a "verification rather than trust" security model.

Meanwhile, privacy protection technologies have been continuously optimized, and in conjunction with account abstraction mechanisms, transaction privacy has been improved while ensuring compliance.

Ethereum co-founder Vitalik Buterin stated that in 2026, Ethereum will refocus on the core values ​​of DeFi and blockchain, gradually evolving towards a more secure and private form through measures such as promoting social recovery wallets and popularizing on-chain interfaces.

Institutional Layout Deepening: From Recognition to Practical Application

The institutional developments at the Davos Forum mentioned by Tom Lee are an important signal of the accelerated institutionalization of crypto assets.

Currently, Wall Street financial institutions have shifted from simply acknowledging blockchain technology to practical applications, building products on smart blockchains such as Ethereum, with asset tokenization becoming a core strategic direction.

JPMorgan Chase CEO Jamie Dimon has previously publicly acknowledged the value of blockchain technology in improving the efficiency of financial services, while leading institutions such as BlackRock and JPMorgan Chase have continued to increase their holdings of crypto assets, demonstrating their confidence in its long-term value through concrete actions.

Ethereum's asset attributes are being reshaped. As a digital asset that can generate staking yields, its stable return capabilities continue to attract institutional investment.

At the same time, the process of putting traditional assets on the blockchain is accelerating, and Ethereum is gradually becoming the core hub for the tokenization of real-world assets.

It is worth noting that Tether, the issuer of USDT, has achieved high profits through the blockchain model and is also one of the world's largest private gold buyers. This phenomenon precisely reflects the trend of integration between traditional finance and the crypto ecosystem.

Institutional investments are no longer confined to the conceptual level, but are instead releasing value through the actual implementation of products, becoming an important support for the strengthening of the fundamentals of crypto assets.

A solid ecological moat: absolute advantages in mobility and application scenarios.

After years of development, Ethereum has built a strong ecological moat, and its advantages in liquidity and application scenarios continue to be consolidated.

From on-chain data, Ethereum's total value locked on the chain consistently ranks first in the industry, forming a strong liquidity aggregation effect and attracting the vast majority of global DeFi projects, NFT ecosystems, and Web3 applications to join.

In the field of stablecoin settlement, Ethereum dominates, handling more than half of the world's stablecoin settlement transactions. This network effect forms a strong competitive barrier that is difficult for other blockchains to surpass.

More importantly, the Ethereum ecosystem is showing mature decentralized autonomy, with more and more applications adopting distributed storage technology to build on-chain interfaces. Even if core developers leave, applications can still operate on their own by relying on the ecosystem, which is in line with Vitalik's design philosophy of "surviving even when gone".

This ecological resilience not only withstands the impact of market cycle fluctuations, but also continues to evolve with technological iteration and institutional empowerment, providing stable support for the fundamentals.

Bitcoin's value anchor: The long-term logic of "digital gold" remains unchanged.

Despite lackluster short-term performance, the long-term logic of Bitcoin as "digital gold" remains unshaken and has instead been strengthened by on-chain data and institutional demand.

On-chain data shows that long-term Bitcoin holders have maintained stable positions, short-term speculative positions have been largely cleared out, and the asset structure continues to optimize, preparing for future price movements.

Tom Lee believes that the narrative of Bitcoin as "digital gold" remains relevant, primarily because its audience is misaligned with that of gold holders, and there is still significant room for growth in the adoption curve.

From the demand side, the intergenerational transfer of wealth has brought incremental demand for Bitcoin.

Generation Z and millennials are far more accepting of digital assets than the previous generation, creating a mismatch between their audience and that of traditional gold holders. This difference in demand allows Bitcoin to maintain its independent fundamental logic even during periods of rising precious metal prices.

Meanwhile, as blockchain technology is gradually recognized by banks and asset management companies, the allocation value of Bitcoin as a core crypto asset is also increasing.

Logical Resonance: The Underlying Connection, Not Opposition, Between Precious Metals and Crypto Assets

Many investors view precious metals and crypto assets as opposing forces, but Tom Lee's view reveals the underlying commonality between the two—the weakening of fiat currency credibility is the core logic driving their rise, only the transmission path and time cycle of funds are different.

As traditional safe-haven assets, gold and silver are the first to become safe havens for funds when the credibility of fiat currencies is questioned and geopolitical situations are turbulent. Their rise is essentially a reaction to the uncertainty of the global financial system.

As an emerging digital value carrier, crypto assets also benefit from the weakening of fiat currency credibility; however, due to their risky asset nature, there is a certain time lag in the transmission of funds.

From a liquidity cycle perspective, funds are currently concentrated on allocating to safe-haven assets, with precious metals taking the lead in absorbing liquidity.

Once the Federal Reserve officially begins cutting interest rates, a global liquidity easing cycle will begin, and funds will gradually spill over into risky assets. As a high-growth asset, crypto assets are expected to become the core recipient of subsequent liquidity.

Tom Lee believes that gold still has a valuation advantage, but its rise is not a negative for crypto assets. On the contrary, it indicates the direction of subsequent capital transmission. After the premium of traditional safe-haven assets is fully released, the market will refocus on the fundamental advantages of crypto assets, and the two are expected to eventually form a value resonance.

Tether's simultaneous investment in both gold and crypto assets also confirms this complementary allocation logic.

Future Outlook: Price Inflection Points and Investment Implications After Fundamentals are Realized

Triggering conditions for price increases

The divergence between cryptocurrency prices and fundamentals will not last long; a turning point requires the convergence of three core conditions.

At the macro level, the Fed's interest rate cut is the key trigger. Currently, the market has clear expectations for the rate cut, and the release of liquidity will provide financial support for crypto assets.

At the industry level, the Ethereum products that institutions deployed at the 2026 Davos Forum have been implemented and are showing results, and the scale of asset tokenization has expanded, which is expected to reshape the valuation system of crypto assets.

From a technical perspective, the effectiveness of Ethereum's ZK technology and Layer 2 scaling solutions will directly determine the extent to which performance bottlenecks are resolved, thereby driving the large-scale growth of ecosystem applications.

Furthermore, if Bitcoin can break through its all-time high in 2026, it will completely absorb the impact of the previous deleveraging event, rebuild market confidence, and accelerate the resonance between price and fundamentals.

Tom Lee's Market Forecast and Reference

Tom Lee's assessment of the market in 2026 is characterized by "cautious in the short term and optimistic in the long term".

He believes that the market will face multiple uncertainties in 2026, including adjustments to the Federal Reserve's policies and changes in the geopolitical situation, which may lead to a correction of around 10%, and short-term sentiment may become depressed.

However, he also emphasized that the current market is in the early stages of a long-term upward cycle that began in 2022. Factors such as the advantages of the US population structure, the wealth accumulation of the younger generation, and blockchain technology innovation will support the continuation of the bull market, and the pullback is only a short-term adjustment.

Regarding price predictions, Tom Lee maintains his view that Bitcoin's long-term upward trend is likely, believing that it could reach new highs in 2026. His core reasons are threefold: first, there is still considerable room for the penetration of "digital gold" into the market; second, the practicality of blockchain technology is gaining institutional recognition, and its application scenarios are continuously expanding; and third, breaking through to new highs will reshape market confidence.

He has always believed that market corrections are excellent buying opportunities, just like the decline in April 2025 caused by tariff issues, which eventually became a temporary bottom.

Compared to Bitcoin, Tom Lee is more optimistic about Ethereum's long-term growth, believing that the asset tokenization wave driven by Wall Street will bring greater growth potential to Ethereum.

Investment Insight: Distinguishing Between Short-Term Volatility and Long-Term Value

Tom Lee's views provide clear guidance for investors: when faced with market volatility driven by sentiment, they should focus on fundamentals, paying particular attention to technological advancements and institutional progress, rather than being swayed by short-term price fluctuations.

In the realm of crypto assets, Bitcoin and Ethereum have withstood years of market testing, demonstrating stronger resilience and growth potential. Furthermore, investing in crypto ecosystem infrastructure-related assets can also allow investors to share in the industry's long-term growth dividends.

In terms of asset allocation, precious metals and crypto assets are not mutually exclusive; rather, they can complement each other.

Precious metals serve as defensive assets, mitigating risks from geopolitical and macroeconomic fluctuations; crypto assets, as growth assets, share in the dividends of the digital economy and technological innovation.

Tom Lee repeatedly reminds people not to be obsessed with market timing, but to hold high-quality stocks for the long term in order to obtain excess returns. Pullbacks are actually good opportunities to invest, so avoid being swayed by short-term emotions and missing out on long-term compound interest.

Navigating the market fog and focusing on the essence of value

The market divergence at the beginning of 2026 is essentially a temporary misalignment between short-term sentiment and long-term value.

The surge in gold and silver prices has masked the improvement in the fundamentals of crypto assets, but it cannot stop the long-term trend of blockchain technology empowering financial innovation. Ethereum's technological upgrades, institutional deployments, and strengthened ecosystem resilience, coupled with the solidification of Bitcoin's "digital gold" logic, together constitute the core support for the fundamentals of crypto assets.

Tom Lee's assessment provides the market with a long-term perspective that cuts through the short-term fog: precious metals and crypto assets share the same underlying logic, with only a time lag in fund transmission.

With the Fed's interest rate cuts taking effect, institutional products scaling up, and technological upgrades proving effective, a synchronized rise in crypto asset prices and fundamentals is expected.

For investors, only by ignoring short-term noise, focusing on the essence of value, and investing in high-quality targets during pullbacks can they seize opportunities in this wave of asset restructuring.

As Tom Lee said, with the fundamentals continuing to improve, it's only a matter of time before prices rise, and long-term investors will eventually reap the benefits of growth.