Tom Lee, the Co-founder and Fundstrat strategist predicts that Bitcoin's (BTC) value will eventually reach $25,000. There are three reasons why he believes the price could exceed the highest seen in 2017.

BTC prices dropped below the $8,000 mark on Wednesday, being traded for around $7,500 per coin. It lost a significant amount of the value gained during April to May. Overall, BTC has lost 41% of its total value due to what Lee called the "typical crypto volatility".

But his point still stands. The following factors explain the fluctuating supply and demand of BTC. One main factor is the BTC production cost. Lee made an appearance on the "Futures Now" show on CNBC, explaining the fact that BTC's price of production is leveled with its trading price. Therefore, the cost of production for BTC stayed at $6,000, still being higher than its replication (aka mining) cost.

A possible factor that could cause the price of BTC to spike is the number of institutional investors joining in on the trade. Some of them are actively following the crypto news but haven't started buying any coins yet. This is likely due to the lack of proper regulations on cryptocurrency as a type of asset. Though that's not really something to worry about once Bitcoin rallies take place.

Furthermore, data collected by Fundstrat confirmed that there exists a pattern regarding BTC performance. Lee expects the last 10 days to show what happens to BTC every year: Its price seems to decline by 25% annually. He recommends that investors hold onto their Bitcoin because, in the next few months, Bitcoin will rise in value up to $25,000.

In early May, Global Advisors from Fundstrat calculated the actual BTC price to be approximately $36,000 by 2019 by observing historical averages. An analysis of Bitcoin's mining costs led them to pinpoint the currency's price range at a minimum of $20,000 to one not exceeding $64,000 after 2019. Right now, Bitcoin trades are at $7,594 apiece.