TLDR
- VIX surge to 20.65 signals market stabilization after a 36% rally since April.
- Tom Lee calls market pullback a healthy reset, not a breakdown or crisis.
- AI and blockchain adoption continue to drive long-term market growth.
- Federal Reserve’s rate cuts provide liquidity and support for stock growth.
Tom Lee, Chairman of Bitmine, has confirmed that the recent surge in the VIX (Volatility Index) is a strong signal that the market may have reached its bottom after a significant 36% rally. Despite the market correction, Lee believes the current decline is a healthy reset, not a long-term breakdown. He points to factors like AI, blockchain adoption, and Federal Reserve policies as key drivers that will continue to support the market in the long run.
VIX Surge: A Sign of Market Stability
On October 10, 2025, the VIX spiked by 25.68%, reaching a level of 20.65, its largest daily increase in over six months. Tom Lee observed that such sharp increases in the VIX typically correlate with market stabilization. He stated, “A VIX spike like this usually marks a stage bottom,” meaning that periods of high volatility are often followed by market rebounds, rather than prolonged downturns.
Lee pointed out that the U.S. stock market had experienced a 36% rally since April 2025, leading to a natural correction. The recent drop in major indices, including the S&P 500, Dow, and NASDAQ, reflected typical profit-taking behavior after a period of sustained growth. However, Lee emphasized that while the VIX reading of 20.65 is high, it is not at the crisis levels seen during past market shocks.
Healthy Market Flush, Not Breakdown
Lee referred to the recent market pullback as a “healthy market flush,” stating that such corrections help clear out excess leverage and restore balance. He explained that these market resets are necessary for the long-term health of the market, as they allow for the reestablishment of momentum.
He further noted that this correction was long overdue, given the rapid rise in stock prices. “This is not a breakdown,” Lee stated, “It’s just a natural pullback after strong gains.” He also pointed out that there is no major structural disruption in the market at present, and the underlying economic drivers remain intact.
Long-Term Market Drivers: AI and Blockchain
Despite the short-term volatility, Lee remains confident about the long-term outlook for the market. He cited three major factors that will continue to support the market’s growth: the boom in AI innovation, increasing blockchain adoption, and the Federal Reserve’s easing policies.
AI-driven companies, such as NVIDIA and Microsoft, have been leading the charge in stock market performance. Even with recent declines, these companies are expected to continue playing a key role in driving future growth. The adoption of blockchain technologies by Wall Street is also seen as a long-term positive for the market.
Moreover, the Federal Reserve’s decision to lower interest rates in early 2025 has injected more liquidity into the economy, further supporting growth in these high-tech sectors.
Analysts Support Lee’s View on Market Resilience
Market analysts have expressed support for Lee’s view that the current volatility is likely a temporary dip rather than a sign of deeper market issues. Studies show that when the VIX spikes by 20% or more in a single day, the S&P 500 tends to see positive returns in the following month. Analysts also agree that the core drivers of AI and blockchain remain solid and will likely stabilize the market in the near future.
As the market digests recent fluctuations, investors are being advised to consider these long-term drivers when evaluating the market’s resilience. Lee’s outlook suggests that any current market volatility may offer a buying opportunity for those focused on future growth in AI and digital assets.
