A Wall Street strategist has created a new bitcoin index that lets investors know when it’s time to buy the cryptocurrency.
In a report from CNBC, Thomas Lee, the co-founder of Fundstrat Global Advisors, explained that now is the time to buy bitcoin.
He said:
When the bitcoin misery index is at ‘misery’ (below 27), bitcoin sees the best 12-month performance. A signal is generated about every year.
At the moment, the bitcoin index is reporting a score of 18.8. This is the lowest it has been since the 6th September, 2011. The index is meant to provide traders with an idea of when they should buy and when they should sell. It is calculated on a scale from zero to 100.
The news of the new bitcoin index comes at a time when market prices have dropped. Earlier this week, the U.S. Securities and Exchange Commission (SEC) announced that exchanges that offer the trading of ‘digital assets that are securities and operates as an ‘exchange,’ as defined by the federal securities laws’ would have to register with the SEC.
In a statement, it added:
The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not. Many platforms refer to themselves as “exchanges,” which can give the misimpression to investors that they are regulated or meet the regulatory standards of a national securities exchange.
This was was followed, at the end of February, after the SEC issued subpoenas in an bid to look into the initial coin offering (ICO) market and how they are structured.
Additionally, yesterday it was reported that Japan’s Financial Services Agency (FSA) had ordered two digital currency exchanges to cease operating for a month after finding they lacked measures in place to ensure consumer protection. The exchanges in question include Bitstation and FSHO.
As a result bitcoin fell below $9,000 during Friday trading amid a major selloff within the cryptocurrency market. However, despite this dip in value, Lee remains optimistic, adding:
The BMI is telling us to keep the negative headlines in perspective. When the BMI is at a ‘misery’ level, future returns are very good.
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