A recent report by Bernstein Research predicts that Bitcoin (BTC) could reach as high as $200,000 by the end of 2025. The 160-page analysis, called the “Black books,” says that Bitcoin miners will continue to combine their operations.
Bernstein also expects Wall Street will hold more Bitcoin than its creator, Satoshi Nakamoto by the end of 2024.
Matthew Sigel, head of digital asset research at VanEck, pointed out that “ten global asset managers now own ~$60Bn wrapped as regulated [exchange-traded funds] compared with $12Bn in September 2022.”
According to the report, Bitcoin miners are set to recover from a post-halving that occurred in April 2024 as they consolidate and take advantage of energy demand from artificial intelligence (AI). The report mentions that companies like Riot, ClearSpark, and Marathon will lead this recovery.
The mining rewards for Bitcoin were halved in April 2024, reducing from 6.25 BTC to 3.125 BTC per block. During this time, demand for AI computing power increased. For instance, Mining companies like Core Scientific have transitioned to AI to generate income.
Nick Hansen, CEO of mining company Luxor, said that miners could earn $2 to $3 from AI per kilowatt-hour, compared to $0.15 to $0.20 from Bitcoin mining.
Gautam Chhugani, head of Bernstein’s digital assets division also supports this $200,000 price prediction. He called it a “conservative estimate” due to rising U.S. debt levels. He highlighted that with the U.S. national debt at $35 trillion, Bitcoin’s limited supply makes it an attractive investment.
Chhugani also advises investors who are looking to get involved with Bitcoin indirectly to invest in companies like MicroStrategy, which holds a lot of Bitcoin, and Robinhood, which is expanding its cryptocurrency offerings.
Moreover, interest in Bitcoin is growing as analysts like Paul Tudor Jones and firms such as JP Morgan and Bernstein are optimistic ahead of the U.S. presidential election in November.
In a recent interview with CNBC on Oct 22, Jones stated, “All roads lead to inflation” as he expressed his preference for assets like Bitcoin, gold, and commodities over fixed income.
Additionally, a recent report from JPMorgan also confirmed that investors are turning to gold and Bitcoin as part of a “debasement trade,” driven by rising geopolitical tensions. The term “debasement trade” refers to increased demand for gold and Bitcoin, influenced by geopolitical uncertainty and inflation concerns.
