Bernstein analysts predict Bitcoin to reach 200k in this timeframe
Bernstein analysts have revised their Bitcoin (BTC) price forecast, increasing it to $200,000 from the previous target of $150,000. They believe that Bitcoin and other crypto-related stocks are undervalued and poised for institutional investment as regulatory pessimism wanes. The analysts specifically highlight their confidence in the “Bitcoin new cycle thesis,” citing increased adoption by institutional investors and global asset managers. They anticipate that the next wave of demand will come from those who are currently on the sidelines of the crypto market.
The analysts also discuss the role of Bitcoin ETFs and institutional interest in driving price gains. They note that Bitcoin ETFs are still in the early stages, with BlackRock filing its Bitcoin ETF application in June 2023. Since then, Bitcoin’s price has surged by 150%. Initially, Bitcoin ETF allocations were driven by retail investors, with institutional share at 22%. However, Bernstein predicts significant growth ahead, expecting Bitcoin ETFs to gain approval at major wirehouses and large private bank platforms by Q3/Q4. They view the initial institutional interest as a “trojan horse” for broader adoption.
Bernstein’s analysis suggests that there is significant room for growth in Bitcoin’s portfolio allocations. Currently, institutional investors account for 22% of assets under management (AUM), with hedge funds making up 36% of this allocation. The next step for these investors is to evaluate “long” positions. Financial advisors, particularly those managing smaller portfolios, are beginning to drive actual demand for Bitcoin ETFs. The note suggests that larger advisors approving ETFs and the potential for substantial allocation within existing portfolios will drive future growth.
The analysts also compare the current price levels of Bitcoin to previous cycles, stating that Bitcoin at $60,000 today is similar to Bitcoin under $10,000 in June 2020. Despite the recent rally, they believe that Bitcoin is still in an early cycle and attractive at its current levels. They conclude that asset managers have strong incentives to enhance marketing and distribution efforts to scale their crypto business.
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