Ethereum’s recent correction has slightly shaken the conviction of one of Wall Street’s most prominent crypto bulls. Fundstrat co-founder Tom Lee, known for accurately calling multiple market recoveries between 2023 and 2025, believes Ethereum could become the market’s near-term leader, with a potential surge toward $9,000-$12,000 by January.
Lee’s prediction rests on two points: accelerating adoption of smart-contract infrastructure and a shift in capital toward tokenized assets. He notes that the demand for crypto is moving away from speculative tokens into real-world use cases such as stablecoins and tokenized gold.
“Wall Street is building, and Larry Fink is pushing to tokenize everything on-chain,” Lee explained in a recent interview. “If the world is moving assets onto programmable blockchains, that’s where the next wave of growth is going to be priced in.”
Fundstrat’s head of technical strategy, Mark Newton, believes ETH could reach between $9,000 and $12,000 by January next year.
While Lee expects Bitcoin to continue higher, possibly into the high six figures, he believes Ethereum has the stronger near-term trajectory. The reason is infrastructure that powers today’s most used blockchain applications sits on Ethereum networks.
Stablecoins and tokenized gold, which have collectively surpassed hundreds of billions in market value, create steady demand for block space, something Bitcoin is structurally less optimized for.
According to Lee, these flows are “eating into Bitcoin demand” while simultaneously boosting Ethereum’s growth expectations.
He also emphasizes that institutions are significantly underweight both crypto assets and high-growth technology stocks. With 80% of large fund managers trailing their benchmarks this year, he expects forced buying in outperforming segments, including crypto, into year-end.
Although Lee acknowledges the Federal Reserve’s decisions remain a critical backdrop, he argues that monetary policy is not the dominant force during short windows of market repricing. December rate cut, if delivered, will be an additional boost.
“If the Fed confirms it’s entering an easing cycle, that’s extremely bullish for growth assets,” he said.
Lee views the broader economy as being in the early stages of a multi-year “AI super-cycle,” one he believes both the market and the Federal Reserve have consistently underestimated. He dismisses fears of inflation re-accelerating, noting cooling labor conditions and a downturn in housing metrics.
Despite the bullish longer-term narrative, Ethereum is currently under pressure. After rejecting resistance near $3,592 earlier this week, ETH declined nearly 10% over the next three days and is trading near $3,200. Technical indicators, including RSI and MACD, show increasing bearish momentum.
If the price closes below $3,170, analysts warn of a potential move toward $3,017. However, a recovery above the 38.2% Fibonacci retracement at $3,592 could restart the uptrend, aligning with the broader institutional accumulation Lee expects into December and January.
Tom Lee’s call for Ethereum to potentially surge toward $12,000 by January is bold, but it is backed by institutional interest in tokenization, the dominance of Ethereum-based smart-contract rails, and improving macro liquidity.
Whether or not Ethereum hits those targets, the structural shift he describes is undeniable. The pipelines being built today, stablecoins, tokenized assets, and institutional blockchain rails, are flowing through Ethereum. And in Lee’s view, the market is only beginning to price that reality in.
1. Will Ethereum really reach $12,000 by January?
Tom Lee believes ETH could hit $9,000-$12,000 due to tokenization demand and institutional flows, but the target remains speculative and dependent on market conditions.
2. Why is Ethereum expected to outperform Bitcoin?
ETH powers most stablecoins, tokenized assets, and DeFi applications, sectors growing faster than Bitcoin’s current utility layer, giving Ethereum stronger near-term momentum.
3. How does tokenization help Ethereum’s price?
As Wall Street tokenizes real-world assets, demand for Ethereum’s smart-contract infrastructure increases, driving higher network usage and long-term value.
4. What macro factors support Ethereum’s upside?
A possible December Fed rate cut, improving liquidity, and the broader AI-driven tech cycle could boost risk assets, including ETH.
5. What are the risks to the $12,000 prediction?
A deeper correction below key support levels or a delay in macro easing could slow ETH’s upward trajectory, even if long-term fundamentals stay strong.