2024-6-16 21:24 |
Analysts at Global investment firm AllianceBernstein continue to be bullish on Bitcoin. Now, they predict that the flagship cryptocurrency will top an astonishing $200,000 by 2025.
Bernstein further expects the Bitcoin price to reach the coveted $1 million mark by 2033. The broker is convinced that once it hits $500,000 in 2029, BTC will double its value in just four years.
BTC Headed For $1M By 2033The price of Bitcoin may have fallen back below its prior $69,000 all-time high after touching a record mark of almost $74,000 in March, but some analysts are still bullish on the foremost cryptocurrency.
AllianceBernstein said Thursday that Bitcoin will reach $200,000 by the end of 2025, up from a previous projection of $150,000. Crucially, Bernstein sees the price of Bitcoin reaching $1 million in less than a decade. The brokerage firm’s price forecast is spurred by the huge demand from the new spot exchange-traded funds (ETFs).
“We believe that the U.S. regulated ETFs were the watershed moment for crypto that brought in structural demand from traditional pools of capital,” Bernstein said in a June 13 research report. “Around $15 billion of net new flows have been brought in by the ETFs combined. We expect Bitcoin ETFs to be equivalent to ~7% of Bitcoin in circulation by 2025 and ~15% of Bitcoin supply by 2033.”
The U.S. Securities and Exchange Commission (SEC) gave its regulatory blessing to 11 spot Bitcoin ETFs in January following a decade of attempts by prominent firms. The investment vehicles, which now trade on stock exchanges, have seen unprecedented success as everyday investors interested in BTC acquire ETF shares.
The Nashville-based global asset manager also cites Bitcoin’s “constrained” supply as another factor that will propel the price following the April quadrennial halving event, when the miners’ rewards for keeping the network running were permanently slashed by 50% from 6.25 BTC to 3.125 BTC. This implies that the new supply of the biggest digital coin by market cap dropped from 900 BTC daily to 450 post-halving — making the cryptocurrency scarcer.
“We believe Bitcoin is in a new bull cycle,” the analysts said. “The ‘halving’ presents a unique circumstance, where natural bitcoin sell-pressure from miners declines by half (or even more, as they inventory more in anticipation), while new catalysts for Bitcoin demand rise, leading to exponential price moves.”
Bitcoin’s Price-To-Margin CostBernstein also highlighted the historical relationship between Bitcoin’s price and its price-to-marginal cost. This important metric reveals how much Bitcoin trades above its production costs, offering key insights into profitability for miners and the wider market sentiment.
Looking at prior Bitcoin cycles, the crypto reached a 5.0 multiplier of its marginal cost of production in 2017, catapulting the price to an all-time high of nearly $20,000. Bernstein noted that 2018 saw the multiplier slump to a low of 0.8. In 2021, BTC attained a 2.3 price multiplier on the marginal cost but slipped to 0.7 in 2022, the investment firm continued, forcing inefficient, unprofitable miners to exit.
The projection for the 2025 cycle suggests an anticipated price multiplier of 1.5, correlating with Bernstein’s price tag of $150,000 by mid-2025.
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