TLDR
- Tom Lee sees S&P 500 reaching 7,000 by year-end after Fed rate cuts.
- He says crypto’s small drop during liquidation shows strong structure.
- Bitcoin and ether open interest lows may set stage for late-year rally.
- Ethereum activity growth supports Lee’s bullish outlook into 2025.
Renowned market strategist Tom Lee expects both U.S. stocks and cryptocurrencies to strengthen through the rest of 2025. He attributed the potential rally to monetary easing, persistent investor caution, and improved positioning in digital assets following a sharp market deleveraging. Lee shared his views Friday on CNBC’s Closing Bell: Overtime.
Tom Lee Holds Firm Bullish Stance on U.S. Equities
Tom Lee, chairman of Bitmine Immersion Technologies (BMNR) and head of research at Fundstrat Global Advisors, reiterated his bullish stance on U.S. stocks. He said he remained confident even during the spring market decline, reminding viewers that Fundstrat’s S&P 500 year-end target was 6,600 at the April lows.
Now that the index is around 6,800, Lee said the market could still see a 4% rise before the end of the year, which would push the benchmark above 7,000. Under favorable conditions, he added, gains could reach 10%.
Lee said that the setup is still constructive, noting that the Federal Reserve’s rate cuts in September after a long pause have historically coincided with market rallies. He pointed out that similar monetary easing cycles occurred only in 1998 and 2024 over the past five decades, both of which supported risk-on behavior into year-end.
Crypto Market Steadies After Major Liquidation
When asked about the crypto market, Lee referenced October 10 as “the biggest liquidation event in five years.” He said the event was triggered partly by U.S.–China tariff tensions, yet bitcoin dropped only 3%–4%, showing durability during stress.
“If this happened in gold and gold only dropped a few percent, we’d call that validation,” he said, describing bitcoin as a resilient store of value. Lee said the current positioning in digital assets is much cleaner, with both bitcoin and ether at record-low open interest levels across derivatives markets.
Such setups, he explained, often occur before an upward move. He also mentioned the improving relationship between traditional finance and crypto, noting JPMorgan’s interest in accepting crypto as collateral as a constructive development for broader adoption.
Crypto’s Connection With Stock Market Trends
During the interview, co-host Morgan Brennan asked if crypto assets still serve as early indicators for equities. Lee said they do, explaining that bitcoin often leads shifts in liquidity and sentiment.
He added that bitcoin’s patterns often move in tandem with the S&P 500, while ethereum tends to mirror trends seen in small-cap stocks within the Russell 2000. He said both markets are showing positive technical signs, supporting his expectation for continued strength across risk assets through year-end.
Ethereum Network Growth and Outlook into 2025
Discussing fundamentals, Lee said Ethereum network activity is increasing across both Layer 1 and Layer 2 solutions, largely fueled by stablecoin transfers and decentralized finance operations. However, he noted that price movements often trail network growth, suggesting more upside could emerge later.
Lee expects both bitcoin (BTC) and ethereum (ETH) to post strong performances into year-end, backed by cleaner leverage conditions and rising on-chain utility. U.S. markets ended Friday higher, with the S&P 500 at 6,791.69, while bitcoin traded at $111,776 and ether at $3,952, continuing their steady year-to-date gains.
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