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Bitcoin climbed past $9,000, to its highest since May 2018 on Monday. Image Credit: REUTERS

HONG KONG: Bitcoin bull Thomas Lee says the biggest digital currency is primed for a “Fear Of Missing Out” rally that could see it hit as high as $40,000 within a few months.

Better market transparency and integrity is supportive of higher prices and a breach of the $10,000 level could trigger “FOMO,” wrote the managing partner and head of research with Fundstrat Global Advisors in a note to clients on Monday. A surge could spark even greater returns in the Grayscale Bitcoin Trust, with potential upside of over 400 per cent, he said.

“Bottom line: Crypto winter looks over,” Lee said. “Investors need to overweight Bitcoin. And a good way to gain exposure is via GBTC.”

Bitcoin climbed past $9,000, to its highest since May 2018 on Monday, as reports that Facebook Inc. is due to unveil a digital currency added to optimism that cryptocurrencies are becoming more widely adopted by mainstream finance. The US-listed trust, which tracks Bitcoin’s market price, jumped 11 per cent to $12, the highest since July 2018, the same day.

The Grayscale Bitcoin Trust “enjoys a NAV premium because of scarcity,” Lee wrote. Assuming Bitcoin trades in the $20,000 to $40,000 range with a net asset value premium of 20 per cent to 60 per cent, that gives a target price for the trust of $29 to $63, he said.

“This is substantial upside and suggests it is a good way to get Bitcoin exposure,” he said.