Analysts at investment firm Bernstein expect Bitcoin (BTC) to resume its upward trajectory, surpassing its previous all-time high of $69,000 and potentially reaching $70,000 this year.
The analysts expressed confidence in the cryptocurrency’s risk-reward profile, stating that no significant challenges are anticipated to impede its ascent.
In a note to investors, analysts Gautam Chhugani and Mahika Sapra highlighted the recent launch of 10 Bitcoin spot exchange-traded funds (ETFs) in the United States, which briefly pushed Bitcoin to $49,000.
Currently trading around $42,600, the analysts noted that the $42,000 to $43,000 range represents a “no-regrets price with asymmetric upside.”
They predicted a further 65% increase in Bitcoin’s value, projecting a price of approximately $70,000 before the year’s end.
Bernstein predicts Bitcoin to skyrocket to $70k by 2024. Positive macroeconomic conditions, ETF net inflows, and on-chain growth are key drivers. BTC’s current range hints 65% gains. #Bitcoin #ETF #Bernstein
— Sharpe Signals (@SharpeSignals) February 5, 2024
Four Reasons Why Bitcoin Would Reach $70,000 This Year: Bernstein
The analysts provided four key reasons to support their bullish outlook.
First, they noted the significant net inflows into ETFs, estimating that around 19,000 Bitcoin were added last week alone.
According to Bernstein, the growing demand for ETFs will contribute to the overall price action of Bitcoin due to its finite supply curve.
“The ETF juggernaut will continue to become material to price action,” the analysts said.
“In a commodity with a known finite supply curve, any incremental buying demand at this scale will become material to price.”
The second reason for optimism is the enthusiastic response from advisor networks regarding the potential allocation of Bitcoin in client portfolios.
ETF issuers have reportedly received unprecedented and accelerated feedback, suggesting that ETFs have unlocked a sustainable source of long-term Bitcoin demand.
CoinShares, in a recent report, indicated that institutional crypto investment products witnessed a net inflow of $708 million last week, with Bitcoin accounting for 99% of these flows.
Favorable Macroeconomic Conditions to Push Bitcoin Price Higher
Bernstein also highlighted favorable macroeconomic conditions as a contributing factor.
The Federal Reserve’s indication of potential interest rate cuts, currently ranging between 5% and 5.25%, makes savings less attractive and encourages investors to seek higher returns elsewhere.
Risk assets, including Bitcoin, tend to perform well in environments with lower interest rates.
Additionally, Bernstein suggested that the outcome of the US presidential election could impact the crypto market.
A Republican victory would imply a change of leadership at the Securities and Exchange Commission (SEC), potentially leading to a different regulatory approach.
The current SEC chairman, Gary Gensler, has faced criticism from the crypto industry and lawmakers for his strict enforcement-oriented stance on crypto regulation.
Bernstein analysts are not alone in their bullish view of Bitcoin.
As reported, Anthony Scaramucci, the founder and managing partner of hedge fund SkyBridge, has suggested that the price of Bitcoin could potentially reach $170,000 in the coming year.
Scaramucci’s prediction is based on two key factors, including the growing demand for newly listed exchange-traded funds (ETFs) and the upcoming halving event scheduled for April.
He explained that if Bitcoin were to maintain its current price of around $45,000 at the time of the halving, it could see a remarkable surge to $170,000 by mid- to late 2025.
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