Fundstrat analyst clarifies differing viewpoints: a differentiated strategy for different investors, rather than a bearish market outlook

The cryptocurrency investment community has recently attracted attention due to a divergence of opinions. Sean Farrell, Head of Crypto Strategy at Fundstrat, a firm founded by Tom Lee, recently posted a response explaining his relatively cautious market judgment.

Same Fund, Why Are There “Split” Predictions?

Fundstrat is not a monolithic entity. Sean Farrell stated that the fund team has multiple analysts, each employing independent research frameworks and different time horizons, aiming to serve diverse client groups. This setup reflects a reality in the crypto asset management field: investors of different sizes and risk tolerances require different strategies.

Tom Lee mainly serves large asset management institutions and conservative investors who allocate 1%–5% of their assets to BTC and ETH, emphasizing a long-term perspective and structural trend analysis. Meanwhile, Sean Farrell’s research targets aggressive investors with crypto asset allocations of around 20% or more, seeking excess returns through active rebalancing across different cycles. This is not a disagreement of viewpoints but stratification of strategies.

Caution ≠ Bearish: Risk Management in a Complex Macro Environment

Sean Farrell adopted a relatively conservative stance in the first half of the year but emphasized that this reflects risk management thinking rather than outright pessimism. The current market pricing is close to “perfection,” but hidden risks remain—government shutdown risks, trade volatility, uncertainties in AI capital expenditures, and changes in Federal Reserve leadership (including adjustments to Yellen’s policy continuity expectations)—all constrain market optimism. Meanwhile, high-yield bond spreads are tightening, cross-asset volatility remains low, and capital flows are diverging.

Bitcoin in the “Valuation No-Man’s Land,” Opportunities and Risks Coexist

Regarding Bitcoin’s current situation, Sean Farrell describes it as “valuation no-man’s land.” In the long term, as major brokerages enter and spot ETF demand improves, Bitcoin is expected to benefit. But in the short term, pressures are mounting: original holders selling off, miners under pressure, MSCI potentially removing MSTR, fund redemptions, and other factors intertwine.

Forecast Timeline: Rebound and Reassessment, Preparing for Year-End Opportunities

Sean Farrell’s baseline judgment is that there may be a rebound at the beginning of the year, followed by another adjustment in the first half, creating more attractive opportunities for year-end positioning. He admits that if his judgment is wrong, he would prefer to wait for confirmation signals rather than act blindly.

Nevertheless, he still expects Bitcoin and Ethereum to challenge new all-time highs before the end of the year, ending the traditional four-year cycle with a shorter, smaller bear market. This aligns with Tom Lee’s overall forecast that “Bitcoin may hit a new high before the end of January 2026,” though the timeframes and risk assessments differ.

According to another Fundstrat report, Bitcoin could fall to $60,000–$65,000 and Ethereum to $1,800–$2,000 in the first half of 2026, further illustrating this “initial dip followed by rise” cycle judgment.