Bitcoin and Crypto Stocks Ready for Big Investors: Bernstein

Crypto markets are set for more institutional adoption, according to Bernstein.

Jun 19, 2024 - 08:21
Jun 19, 2024 - 08:21
Bitcoin and Crypto Stocks Ready for Big Investors: Bernstein
Bitcoin and Crypto Stocks Ready for Big Investors: Bernstein

Spot bitcoin ETFs (exchange-traded funds) are expected to be approved by major financial firms and big private banks in the third and fourth quarters of this year, says a report by Bernstein.

Bernstein predicts that bitcoin could hit a high of $200,000 in 2025, $500,000 by 2029, and $1 million by 2033.

Bitcoin and crypto-related stocks are currently undervalued and ready for institutional adoption, according to a research report by Bernstein released on Wednesday.

Institutional Adoption on the Horizon

Critics argue that the spot bitcoin ETF trade has already seen its peak, mainly due to early investments from retail investors and institutional demand focused on "basis cash and carry trades" rather than new long positions.

However, Bernstein's analysts, Gautam Chhugani and Maihka Sapra, believe that bitcoin ETFs are on the verge of getting approvals from major financial firms and large private banks by the end of this year. Spot bitcoin ETFs were first approved in the U.S. in January, making it easier for more people to invest in bitcoin.

The institutional basis trade, where investors buy spot bitcoin ETFs and sell bitcoin futures contracts to profit from price differences, seems to be a key strategy for adoption. As ETF liquidity improves, these investors are now considering holding long-term positions in bitcoin.

Expected Growth and Approval

The report suggests that bitcoin ETF inflows will increase significantly in the third and fourth quarters. This growth will be driven by large financial advisors approving these ETFs and reallocating investments from existing portfolios.

Bernstein expects bitcoin to reach $200,000 by 2025, $500,000 by 2029, and $1 million by 2033.

Top Picks for Investment

Bernstein has given an "outperform" rating to bitcoin miners like Riot Platforms (RIOT) and CleanSpark (CLSK). The broker also rates software company and bitcoin investor MicroStrategy (MSTR) and trading platform Robinhood (HOOD) highly.

In summary, Bernstein sees a bright future for bitcoin and crypto-related stocks, driven by upcoming institutional adoption and ETF approvals.

Also Read: Bitcoin: The Future of University Funding? University of Austin Explores Cryptocurrency Endowment

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