International asset manager Bernstein predicts that the price of Bitcoin could rise to $150,000 by 2025.
This bullish outlook is based on the expectation that the US Securities and Exchange Commission (SEC) will approve a spot Bitcoin exchange-traded fund (ETF) in the first quarter of 2024.
Bernstein expects that the SEC’s approval of a spot Bitcoin ETF would result in up to 10% of Bitcoin’s circulating supply being allocated to ETFs.
Bitcoin is becoming a commodity
A spot Bitcoin ETF is an investment product that tracks the price of Bitcoin. This would give traditional investors direct access to Bitcoin through their investment portfolios. The most comparable product at the moment is the Grayscale Bitcoin Trust (GBTC), which owns about 3% of all Bitcoins in circulation.
Bernstein analyst Gautam Chhugani emphasizes the importance of timing in his analysis. He argues that even if you don’t really like Bitcoin, crypto should be given the same status as tradable commodities. This would mean that the SEC sees that the market is ripe for an approved ETF.
Chhugani’s comments were made in a broader context. He also talked about the stock price performance of Bitcoin mining companies.
Bitcoin halving and death spiral for miners
The analysis also looked at Bitcoin’s next halving, scheduled for April 2024. During this event, Bitcoin mining rewards will be halved, a feature built into Bitcoin’s underlying code. Chhugani believes this will lead to the elimination of less successful miners, benefiting those who remain in the market.
The reward for miners will be halved, which obviously has a huge impact on the revenues of these companies. That’s why the specter of mining’s so-called death spiral reappears with each halving. But these fears have repeatedly proven unfounded as the overall computing power of Bitcoin miners continues to increase.
Source: BtcDirect
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Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
