A week before the Consensus cryptocurrency conference got underway in Manhattan, Fundstrat Global Advisors research head Tom Lee predicted that the gathering in Manhattan would spark a rally in Bitcoin’s price. Instead, cryptocurrency prices declined throughout the event, falling roughly ten percent.
To put that in context, Lee’s May 7 prediction suggested that he expected the Consensus conference to generate a rally that would equal or surpass those seen in previous years. For example, Bitcoin’s price increased by 69 percent during the 2017 Consensus gathering, and continued to rise for two months after the event ended.
In a letter to clients on Friday, Lee acknowledged the failed prediction and offered his own analysis for why the expected rally failed to materialize. As Bloomberg reports, that letter cited a lack of regulatory clarity and resistance from the financial industry as factors that helped to explain why the Bitcoin market didn't react as he anticipated.
According to Lee, the conference environment would ordinarily strengthen the digital currency community’s resolve because large community gatherings tend to reinforce confidence and demonstrate rising interest. This year, however, that renewed sense of community and normalcy failed to translate into an increase in the type of investor sentiment needed for a price rally.
Nevertheless, Lee told his clients that he remains optimistic, despite the markets’ failure to produce the anticipated price increase:
“Crypto still faces significant internal resistance and hurdles within traditional financial institutions. But it is encouraging, nonetheless, that a large share of incremental attendance are financial institutions.”