“Bitcoin faith” rekindled! Institutions are shouting that the rise has only just begun; these concept stocks have already taken off

Futu News ·  Mar 14 17:32

The Bitcoin craze continues.

As the “halving” period approaches, Bitcoin's recent gains have been overwhelming. This year, the increase has exceeded 74%, successfully breaking the $73,000 mark, reaching a record high.

Data source: tradingview

Institutions shout: Bitcoin's rally has only just begun

As the price of Bitcoin continues to rise, institutions have also begun to give target prices for Bitcoin.

Analysts at Bernstein, a well-known investment management and research firm in the US, confidently threatened that Bitcoin's rise has only just begun and is expected to rise to 150,000 US dollars by the middle of next year.

In fact, as early as November of last year, Bernstein first proposed a target price of 150,000 dollars for Bitcoin. However, in this Monday's report, the bank said it is more confident about this target price:

We built an institutional traffic model for Bitcoin in our estimates to derive the price of Bitcoin. We estimate that in 2024 the Bitcoin market will flow in $10 billion, and another 60 billion dollars in 2025.

Since the Bitcoin ETF was approved in January of this year, its capital inflow has already exceeded 9.5 billion US dollars, which further strengthened Bernstein's confidence in Bitcoin's steady rise to 150,000 US dollars. Analysts said,

At this rate, in the 166 trading days remaining in 2024 alone, Bitcoin ETF inflows will be higher than what we expected in 2025.

Standard Chartered Bank expects Bitcoin to reach 100,000 US dollars by the end of this year; the target range set by research firm Fundstrat is 116,000 to 137,000 US dollars; according to the hedge fund SkyBridge forecast, Bitcoin will reach 170,000 US dollars by April 2025. Fairlead Strategies LLC technical analyst Katie Stockton said that the mid-term price of $80,000 is attainable.

JMP Securities, a well-known investment agency on Wall Street, said in a research report released on Wednesday that

It is estimated that in the next three years, Bitcoin spot ETFs may have capital inflows of up to 220 billion US dollars, which means that if a multiplier is applied to new capital estimates, the Bitcoin price may quadruple to reach 280,000 US dollars.

Furthermore, Cathy Wood, the founder of Ark Investment Management Company and known as “Sister Mu Tou,” gave an astonishing target price, she said,

Bitcoin's recent price performance marks a change in trends in the institutional sector. The cryptocurrency's market capitalization is expected to reach $20 trillion in the next few years, which will bring the price of each bitcoin close to $1 million.

However, J.P. Morgan warned that the estimate of $42,000 is the level we expected. Once the optimism caused by Bitcoin's halving subsides after April, the Bitcoin price will fluctuate towards this level.

Under the crypto boom, which companies can be expected to win?

Previously, when the Bitcoin ETF was approved, Futu Information compiled some Bitcoin concept stocks. The details are as follows:

Among them, the trend of some Bitcoin concept stocks even surpassed the increase of Bitcoin itself.

  • “Bitcoin Shadow Stock” - MicroStrategy

“Bitcoin shadow stock”, the listed company that holds the most Bitcoin in the world$MicroStrategy (MSTR.US)$It is one of the biggest beneficiaries of this wave of Bitcoin's rise. The company's increase has reached 180% this year, with a cumulative increase of more than 1147% since 2023.

On Monday local time, Michael Saylor, founder of the company focused on software development, announced on social media platform X that his company used the issuance of convertible bonds and additional cash revenue to purchase an additional 12,000 bitcoins, spending nearly US$822 million. Since March 6 (the day the company announced the bond issuance price), the stock has increased 68% cumulatively.

This also raised MicroStrategy's total Bitcoin holdings to 205,000, worth more than $15 billion, or half of the company's current market value.

However, Canaccord's analysis showed that as of Monday, MicroStrategy's share value had a premium of 86% over its Bitcoin holdings. Moreover, this number has increased significantly over the past three days. According to Canaccord's analysis, MicroStrategy's equity premium is now close to 99%.

  • The world's largest digital currency exchange - Coinbase

As one of the world's largest cryptocurrency trading platforms,$Coinbase (COIN.US)$The business has gone through a painful period over the past two years. However, market analysts believe that as Bitcoin and Ethereum prices soar, more individual investors may return to the market, thereby boosting the company's business. Since 2023, the company has accumulated a cumulative increase of more than 600%, far exceeding Bitcoin's increase of about 320%.

Notably, Coinbase's latest results show that in the fourth quarter, it achieved net profit of 273 million US dollars (profit of 1.04 US dollars per share), reversing the loss situation of 557 million US dollars in the same period last year, marking the first quarterly profit in two years, and Coinbase turned a loss into a profit.

Coinbase's management also mentioned in a letter to shareholders that due to increased volatility in the crypto asset market, the positive impact of approval of Bitcoin spot ETFs, and optimistic expectations for future macroeconomic improvements, these factors have all contributed to an increase in the “risk appetite” of the market, thereby contributing to the growth of Coinbase's performance.

  • The world's largest pure Bitcoin mining company—Marathon Digital

As the world's largest pure Bitcoin mining company$Marathon Digital (MARA.US)$12,852 bitcoins were mined in 2023, setting a new record, an increase of 210% compared to 2022. Additionally, the hash rate, which measures its total mining capacity, was increased by 253%.

The company's stock price has accumulated a cumulative increase of 476% since last year, but it is worth noting that its performance has not been good this year, and it still recorded a 16% decline during the year.

Regarding Bitcoin mining companies, some organizations believe that although the price of Bitcoin will rise sharply after being halved, the mining difficulty will increase after the profits are halved. Leading companies with high energy efficiency mining machines and sufficient cash flow have significant advantages, and industry concentration may continue to increase.

In addition, mining stocks, as alternatives to Bitcoin, are also facing competition from Bitcoin spot ETFs. Therefore, since the beginning of the year, some mining stocks such as MarathonDigital have outperformed Bitcoin in stock prices.

However, analysts Bernstein are still optimistic about the prospects of mining stocks. The bank said that during the bull market cycle, Bitcoin miners provided a higher beta value than Bitcoin itself due to the increase in mining profits and the doubling of the market expansion.

Analysts believe that the recent decline in the price of Bitcoin mining stocks may be the “last (buy) window” for investors before the price of Bitcoin is halved, because mining companies' stock prices will quickly catch up with the sharp rise in Bitcoin prices, and investors should view the current period of weakness in Bitcoin mining stocks as a key investment opportunity:

As Bitcoin climbs to new highs, we expect institutional interest in Bitcoin-related stocks will eventually reverse, and Bitcoin miners will be the biggest beneficiaries. Trading Bitcoin miner shares requires more patience.

What investors need to be wary of, however, is that since the introduction of Bitcoin, prices have fluctuated and plummeted. Surges and falls are the norm, and the multiple risks faced by the market cannot be ignored.

Want more fundamental information on Bitcoin concept stocks? Click on the courses below to learn more investment techniques:

Outperform Bitcoin! Are these three Bitcoin concept stocks worth watching?


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