Despite the recent weakness in currency prices, research firm Bernstein still expects Bitcoin to resume its upward trajectory after the halving, reiterating its cycle target of $150,000.
Bitcoin will hit $150,000 in 2025
Citing the Bernstein Report, analysts Gautam Chhugani and Mahika Sapra noted in a note to clients on Wednesday that Bitcoin's bullish trajectory is expected to resume after the halving, when mining hashrate has been adjusted and ETF inflows will Recovery (negative to flat over the past 10 days). Additionally, the addition of spot Bitcoin ETFs with large broker-dealers will continue to provide structural demand for Bitcoin. Therefore, Bernstein still maintains his previous view:
Bitcoin will hit a cycle high of $150,000 in 2025.
Bitcoin price rises after previous halvings
In the report, Bernstein also compared the trend of previous Bitcoin halvings and believed that Bitcoin halvings are related to large fluctuations in cryptocurrency prices. While not a direct cause-and-effect relationship, these events often precede significant bull runs in the Bitcoin market.
Bernstein noted:
At today's prices, miners produce/earn approximately $50 million in Bitcoin per day, which is only 0.12% of daily Bitcoin transaction volume.
Therefore, selling pressure is no longer the focus and the focus should be on new demand catalysts in each cycle.
Demand catalysts usually coincide with new supply reductions after halving events, such as post-pandemic liquidity and the purchase of Bitcoin by companies such as Tesla, Square and MicroStrategy. This cycle is driven by spot Bitcoin ETFs. and leading global asset managers to drive demand.
Historically, Bitcoin price breakthroughs have always occurred after halving events, sometimes months after the halving. However, in the current 2024 cycle, the approval of the ETF in January resulted in a significant price increase ahead of the halving. Over the past 10 days, Bitcoin has corrected about 15% as ETF inflows slowed and GBTC sold off heavily.
Post-correction though, the integration of spot Bitcoin ETFs with large broker-dealers will continue to provide structural demand for Bitcoin.
Miners to outperform Bitcoin in the coming year
Crypto venture capital institution Wintermute also pointed out that miners have continued to sell BTC steadily recently, which is a measure for miners to ensure that they can still maintain profits after the halving, reduce the impact on income, and at the same time take profits due to the rise in currency prices.
However, Bernstein predicts that as less efficient mining operations become unprofitable, the industry will consolidate towards four leading mining companies, which Bernstein is optimistic about: CleanSpark, Marathon, Riot Platform and Cipher Mining. And with renewed interest from app developers, Layer 2 scaling infrastructure teams, and NFTs, miners can earn more from transaction fees. Therefore, Bernstein believes that leading mining companies may outperform Bitcoin in the next 12 months.
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