in a x.com/TheBlock__/status/1801549849738756262″ target=”_blank” rel=”nofollow”>analysis Published on Thursday, the world's leading investment firm AllianceBernstein, with assets under management worth $725 billion, significantly raised its price target for bitcoin, predicting that the leading cryptocurrency will reach $1 million in 2033. This bullish outlook is is underlined by a new wave of adoption through US spot bitcoin exchange-traded funds (ETFs) managed by heavyweight asset managers including BlackRock, Fidelity and Franklin Templeton.
bitcoin's path to $1 million in 2033
Bernstein analysts Gautam Chhugani and Mahika Sapra outline a detailed scenario in which they expect assets under management in bitcoin-related ETFs to rise to about $190 billion by 2025, a substantial jump from $60 billion today. The report states: “We believe US-regulated ETFs were the defining moment for cryptocurrencies that generated structural demand from traditional capital pools.”
They highlighted the considerable impact of these funds, which have already channeled approximately $15 billion in net new flows to the market.
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The report extrapolates that by 2025, bitcoin ETFs will account for around 7% of all Bitcoins in circulation, and by 2033, this figure could rise to around 15% of the total bitcoin supply. This significant uptick in institutional interest and investment is set to play a pivotal role in driving the price of bitcoin higher.
A critical aspect of Bernstein's analysis is the effect of bitcoin supply mechanics, particularly halving events. The most recent halving in April reduced the block reward for miners from 6.25 btc to 3.125 btc, effectively halving the new daily supply from 900 btc to 450 btc.
According to Chhugani and Sapra, “the halving presents a unique circumstance, where the natural selling pressure of bitcoin by miners decreases by half (or even more, as they inventory more in advance), while new ones emerge. catalysts for bitcoin demand, leading to an exponential price. movements.”
Historically, after halving events, btc has seen significant price rallies. Analysts rely on past cycles for context: In 2017, bitcoin rose roughly five times its marginal cost of production, then bottomed out at 0.8 times the following year. A similar pattern was observed in the 2021 cycle.
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For the 2024-27 cycle, they project a more conservative but substantial increase to 1.5 times the marginal cost of production of bitcoin, which translates to a projected mid-cycle high of $200,000 by mid-2025. In the next cycle, Bernstein expects the price of bitcoin to reach half a million US dollars in 2029, before surpassing the million dollar mark four years later.
Outlook for MicroStrategy
Along with his bitcoin outlook, Bernstein also initiated coverage of MicroStrategy with an Outperform rating, targeting a $2,890 price for the stock by the end of 2025. MicroStrategy has become notable for its btc acquisition strategy, and you now own 214,400 btc, or 1.1%. of the cryptocurrency's circulating supply, valued at approximately $14.5 billion.
MicroStrategy's aggressive acquisition of bitcoin, financed through convertible notes (a form of long-term debt that converts into equity under specific conditions), demonstrates a solid investment strategy that analysts believe offers “downside risk.” liquidation” due to the already profitable nature of its holdings. based on current bitcoin prices. They forecast MicroStrategy's holdings to rise to 1.5% of bitcoin supply by 2025.
At the time of this publication, btc was trading at $66,946.
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