Is the bull run over for bitcoin? Bernstein maintains bullish projection
At the time of writing, the price of bitcoin (BTC) is falling rapidly, reaching levels not seen since mid-May. Despite this circumstantial correction, medium and long-term expectations remain largely bullish.
The following chart, provided by TradingView, shows the price of bitcoin over the last 30 days:
Bitcoin could reach $200,000 in 2025, according to research by the American company Bernstein Research. Furthermore, specialists predicted that within ten years the digital currency would be worth $1 million.
These analyst predictions are mainly based on the growing demand for bitcoin ETFs. In particular, they referred to how it positively influenced, since January 2024, the approval and implementation of these financial instruments in the United States.
This reason led the way for bitcoin to be introduced into large corporations and attract investors from traditional finance and was pointed out by Bernstein analysts as the starting point that led to the current bullish cycle of bitcoin:
“We believe that US regulated ETFs were decisive for cryptocurrencies and generated structural demand for traditional equity funds.”
Gautam Chhugani and Mahika Sapra, Bernstein specialists.
In turn, they assured through their investigation that The market’s attraction to BTC spot funds will continue for years to come:
“The ETFs combined have generated around $15 billion of net new flows. “We expect bitcoin ETFs to be equivalent to approximately 7% of bitcoin in circulation by 2025 and approximately 15% of bitcoin supply by 2033.”
Gautam Chhugani and Mahika Sapra, Bernstein specialists.
As a result of the research, they estimate that, for January 2025, bitcoin ETFs will manage around $190 billion, while currently all bitcoin spot funds in the world manage around $69 billion. These assumptions about the possible increase in money flows from BTC spot funds can be seen in the following graph.
This great demand raised by Bernstein’s research can be corroborated in the graph provided by the analysis platform, SoSoValue, which reflects what happened during the first half of 2024.
Bitcoin spot funds in the US have seen record inflows since their inception in January 2024. For example, On March 12, these funds they surpassed the 1,000 million dollars in tickets, which was the day with the highest income for this instrument. Also, on June 4, a total income of 887 million dollars was detailed and, three days later, These ETFs reached a record 19 consecutive days with positive inflows.
Among these funds, the one issued by the company BlackRock stands out, which holds the largest bitcoin ETF in the world, the iShares Bitcoin Trust, with its ticker IBIT. It owns a total of 305,296 bitcoin, which is equivalent to approximately $20.5 billion, almost a third of the total managed by bitcoin ETFs in the world.
On the other hand, Bernstein analysts analyzed and detailed another point as relevant to determine that “bitcoin is in a new bullish cycle” and thus predict that the price of the digital currency will reach $200,000 in 2025. Its about halving occurred on April 20, 2024.
This event decreases the reward that miners receive for their actions within the Bitcoin network and therefore reduces the supply of new bitcoin. This fact, if it coincides with the increase in market demand for BTC, would cause a rise in the price of the digital currency.
“The halving presents a unique circumstance, where the natural selling pressure of bitcoin by miners is reduced by half (or even more, as they store more in anticipation).”
Gautam Chhugani and Mahika Sapra, Bernstein specialists.
The company considers that increase in production cost of bitcoin, which skyrocketed after the last halving, It could be another indicator of the future that they foresee for the price of BTC. To approximately value the production cost of BTC, some elements such as electricity, hardware, internet, salaries, among others, are considered, and an estimated number is extracted from there.
Currently that price exceeds $75,000while the current price of bitcoin is $65,000 at the time of this writing. Bernstein analysts predict that this issue is another important item that could trigger the price of BTC because, historically, the price of bitcoin does not fall below the cost of production for long periods and, thus, specialists expect a rebound. of the price of bitcoin.
«For the 2024-27 cycle, we expect bitcoin to rise to 1.5 times the marginal cost of production of bitcoin, implying a cycle high of $200,000 (appreciation of 2.8 times the current BTC price) by mid of 2025.
Gautam Chhugani and Mahika Sapra, Bernstein specialists.
