Bernstein analysts anticipate bitcoin’s resumption of its bullish trajectory post-halving, reiterating a target of $150,000 by the end of 2025.
In a note to clients on Wednesday, Gautam Chhugani and Mahika Sapra of Bernstein expect bitcoin’s upward trend to resume after the halving, as mining hash rates adjust and ETF inflows rebound. They emphasize the continued integration of spot bitcoin ETFs with wirehouses and RIAs, which they believe will sustain structural demand for bitcoin. Their projection aligns with Bloomberg ETF analyst Eric Balchunas’ sentiment, who likened the accessibility of spot bitcoin ETFs on significant wirehouse platforms to putting a product on prominent retail shelves, anticipating a positive impact.
Historically, Bitcoin halvings have triggered significant price fluctuations, often preceding substantial bull runs. The analysts clarify that halving events alone don’t lead to bitcoin appreciation; rather, it’s new demand catalysts that drive price growth. They note a decline in sell pressure from miners post-halving, which has become less impactful over time due to reduced daily sell-offs relative to trading volume.
Demand catalysts, synchronized with supply reductions post-halving, historically include post-pandemic liquidity and corporate bitcoin purchases. The current cycle is marked by spot bitcoin ETF approvals and global asset managers driving demand. Unlike previous cycles where price breakouts followed halving events, the current cycle saw strong price appreciation pre-halving, partly due to ETF approvals. However, recent slower ETF inflows and significant GBTC selling have led to a correction in bitcoin price.
While overall flows for spot bitcoin ETFs have slowed since March, some miners maintain solid balance sheets pre-halving, despite negative stock performance. Bernstein anticipates around 7% of the network hash rate to shut down post-halving, as less efficient miners become unprofitable and the industry consolidates toward leading public miners. They highlight potential risks of a more drastic reduction in hash rate if bitcoin prices decline significantly but believe the chances are lower due to sustained ETF demand.
The analysts reaffirm their belief that top public miners could outperform bitcoin over the next 12 months, given increased market share, strong revenues, and a growing capacity pipeline.
