Fundstrat co-founder Tom Lee predicted at WebX 2026 that Ethereum (ETH) has bottomed and could rally to $2,200 by August, citing technical signals and historical parallels. Speaking at the Tokyo conference on July 13, Lee argued that current headwinds are fading and that ETH is entering a "Chapter 2" growth phase akin to Amazon and Nvidia.
Four headwinds that dragged crypto lower
Lee identified four factors behind this year's crypto market weakness. First, the Federal Reserve pivoted from expected rate cuts to effective rate hikes, removing the monetary tailwind that had supported digital assets. Second, the U.S. CLARITY Act, which would unify crypto regulation under the CFTC, has only a 44% probability of passage on Polymarket, though industry insiders believe the real odds are higher. Third, AI investments absorbed 86% of U.S. venture capital in 2026, starving crypto projects of new funding. Fourth, a slump in financial stocks dampened enthusiasm for alternatives like crypto. "But these headwinds have largely been priced in," Lee said. "Being bearish now means being bearish near the bottom."
Technical signals point to a rebound
Lee cited market timer Tom DeMark, noting that Ethereum's current price pattern shows an 89.81% correlation with the S&P 500 in 1987, which led to a rally by August. Former Bank of America technical strategist Steve Suttmeier also published a bullish view on July 9, saying that if ETH breaks resistance at $1,846–$1,876, the next target is $2,200. At the time of the speech, ETH traded around $1,700, implying a roughly 30% upside. "This is a tactical bottom signal," Lee said. "More important is whether you can get excited about what comes next."
Ethereum's 'Chapter 2' and institutional adoption
Lee compared Ethereum's current stagnation to Amazon, Nvidia, and JPMorgan before their breakout second chapters. Amazon traded at $6 for 12 years before AWS and Prime Day drove it to $241; Nvidia stayed at $1 for 17 years before AI demand sent it 200x higher. Ethereum, after peaking near $5,000 in 2025, now sits around $1,732. Lee outlined four pillars for ETH 2.0: a new foundation structure, agentic AI, a settlement layer for finance, and "ETH is money." He highlighted growing institutional adoption, including BlackRock's BUIDL fund, JPMorgan's MONY program, and major exchanges launching L2 chains—Robinhood Chain on Arbitrum, Coinbase's Base, and Kraken's Ink on Optimism. "Warren Buffett said the market can ignore business success for a while, but eventually it will recognize it," Lee said. "The same applies to ETH."
AI threat and blockchain as defense
Lee warned that AI agents could soon earn more than humans, potentially locking people out of their own bank accounts. He cited Stanford students walking out on Google's CEO, anti-AI vandalism groups, and data showing that 75% of Polymarket trades, over half of web traffic, and about half of emails are already machine-generated. "Don't trust the government, banks, or Big Tech," Lee said. "Smart contract blockchains are the best defense against AI taking over your life."
Bitmine nears 5% ETH supply target
Lee's company Bitmine has almost reached its goal of acquiring 5% of all ETH supply within its first year, holding 5.76 million ETH (4.8% of supply) as of July 10. About 85% of those holdings are staked via MAVAN, the world's largest single staking operator managing $13–$14 billion in ETH. Bitmine's preferred stock (ticker: BMNP) was oversubscribed 5x, raising over $1 billion, and trades at an ~11% yield, below MicroStrategy's ~13%, indicating higher credit quality. The company is listed on the NYSE and included in the Russell 1000. Lee said he is in no rush to cross the 5% threshold, respecting Vitalik Buterin's preference that no single entity hold more than that.