Hedge fund veteran Tom Lee remains long-term bullish on Bitcoin (BTC) and expects the crypto industry to come out of its bear market stronger than before.

In a new interview on CNBC, the Fundstrat managing partner says while 2022 has been “terrible” for crypto investors, he thinks a new chapter could be emerging.

“Nobody has made money in crypto in 2022, but it’s not that different than 2018. If we look back at that crypto winter when Bitcoin went from $17,000 to something like [$3,200] or so, that was the time that some of the best projects were created. So I think that it’s an important moment for the industry. I think it is cleansing a lot of bad players, and I think it’s important.

Do I think crypto is dead? No, I think there are a lot of people throwing gasoline in a crowded theater and yelling ‘Fire!,’ and it’s just going to be important for those who really like what decentralization and what Bitcoin are doing. They need to have the staying power, but yeah, 2022 has been terrible.”

Lee compares today’s crypto space to the traditional finance sector of 2008, where many firms imploded during the crisis before giving way to stronger entities.

“We first read about Bitcoin in 2017, and we recommended people put 1% of their funds into Bitcoin at the time when Bitcoin was under $1,000. That holding today would be 40% of their portfolio without rebalancing. So does Bitcoin still make sense for someone to have some sort of ballast? Yes.

Is it going to have another terrible year next year? I think if there’s more fraud, yes. But if this was the moment of financial stress, what we’re going to see emerge from this is companies that emerged from the GFC (Great Financial Crisis), the ascendancy of banks like JPMorgan really came out of ’08, and I think the mistake people made in the GFC is to say that banks were untouchable and that’s what’s happening in crypto now”

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