US asset manager Bernstein reports: Bitcoin expected to rise to $150,000 by mid-2025

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Bitcoin, the world’s largest cryptocurrency, surged in price in October thanks to speculation that the first spot Bitcoin ETF would be approved in the United States. The price has more than doubled since the beginning of the year, from $17,000 to $35,000.

This is just the beginning, according to analysts at the US asset manager: Bitcoin is expected to rise almost 330 percent to $150,000 by mid-2025 as the world’s largest cryptocurrency enters a new cycle. In a report, Bernstein writes that Bitcoin is facing potentially major market moves due to the upcoming halving and the likely approval of the first spot Bitcoin ETFs. This was reported by financial news platform Markets Insider.

“You may not like Bitcoin as much as we do, but a dispassionate look at Bitcoin as a commodity points to a reversal of the cycle,” said the report, led by analyst Gautam Chhugani.

“A good idea is only as good as its timing,” Bernstein analysts continue. According to the report, Bitcoin has historically rallied whenever a halving occurred. This is a specific event that reduces the amount of Bitcoin a person receives for mining the cryptocurrency. This will happen every four years, and the next halving is scheduled for April 2024.

Smaller supply and larger demand

Since halving essentially restricts the supply of Bitcoin, crypto miners are less likely to sell accumulated tokens as they anticipate higher prices in the future. As Bernstein noted, 70 percent of Bitcoin tokens have not been sold in the last twelve months anyway.

At the same time, demand for the currency from new buyers is increasing, especially as the U.S. Securities and Exchange Commission (SEC) is expected to approve spot Bitcoin ETFs soon. Although the SEC initially tried to block such efforts, its rejection of the Grayscale crypto ETF was overturned in court in August. This potentially paves the way for a regulatory rollback.

“U.S.-regulated ETFs will be a game-changer for crypto, and we expect SEC approval in late 2023 or the first quarter of 2024,” Chhugani writes. “Following the halving, we expect Bitcoin spot demand through ETFs to exceed miner sales by a factor of six to seven at its peak. This means Bitcoin ETFs will account for nine to ten percent of spot Bitcoin in circulation by 2028.”

Miners are also interesting as an investment

Analysts believe Bitcoin will continue to rise in value until the ETFs are approved and the initial reaction post-approval, followed by a halving followed by some profit-taking leading to a “big bounce.”

The halving will also impact the crypto mining industry and lead to further consolidation. As the number of tokens rewarded decreases, high-cost miners will come under the most pressure and the least efficient ones will be unlikely to survive, leading to consolidation.

Bernstein’s Chhugani points out two miners that investors should keep an eye on: Riot and CleanSpark. He called it a “high-beta way to earn exposure,” citing its low energy costs, high liquidity and unleveraged balance sheets. Both companies are rated “Outperform” by Bernstein.

Source :Blick