Analysis of Bernstein on the price of Bitcoin between correction and buying opportunity


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The recent correction in the price of Bitcoin, over 10% in the last week, is temporarily seen as a buying opportunity at lower prices, according to Bernstein. 

Furthermore, company analysts predict further consolidation in view of Bitcoin’s halving in April, with the bullish market expected to continue. Let’s see all the details below. 

Bitcoin Price: Bernstein predicts further consolidation before the April event

As anticipated, the recent decline in the value of Bitcoin, which has brought the cryptocurrency from over $73,000 to about $63,000, is seen as a temporary buying opportunity at lower prices. 

This is in anticipation of the April halving, according to analysts at Bernstein, a research and brokerage company.

Gautam Chhugani and Mahika Sapra, analysts at Bernstein, emphasized on Tuesday that they consider the current consolidation phase of Bitcoin as temporary and as a buying opportunity before the halving. 

They are indeed optimistic about an eighteen-month period of opportunity for both Bitcoin and the entire crypto ecosystem. Remember that Bitcoin halvings are scheduled every 210,000 blocks, approximately every four years.

The next halving, scheduled for April 20, will reduce the reward for miners on the network from 6.25 BTC to 3.125 BTC per block, although they will continue to earn transaction fees.

Some considerations on Bitcoin ETFs

Furthermore, US Bitcoin ETFs remain a significant factor in the market. 

The GBTC fund of Grayscale has seen record daily outflows, which on Monday reached $642.5 million. Bringing the total net outflow to $154.4 million yesterday, the first time since March 1st.

Bernstein analysts note that ETF flows reflect market performance, with higher inflows during periods of growth and slowdowns with weakness in prices. 

However, considering that Bitcoin’s history shows consolidation before the halving, and observing the rally both before and after the introduction of Bitcoin ETFs, it is not surprising the current price action.

Chhugani and Sapra have written that the correction seems healthy and does not affect their long-term view, which predicts Bitcoin reaching a maximum of $150,000 within the cycle by 2025.

Currently, Bitcoin is trading at around $63,626. The cryptocurrency has seen a 7% decrease in the last 24 hours and a 12% decrease in the last week, while still being up by about 50% since the beginning of the year.

Last week, Bernstein stated that the actions of public miners remain the best stock indicator for Bitcoin as its price approaches the target of the 2024-2025 cycle, especially considering a recent period of underperformance.

Analysts on the cryptocurrency ecosystem: analysis and opinions 

Analysts have focused in particular on Riot Platforms and CleanSpark. 

In particular indicating that at current prices of Bitcoin and above, even if the production costs of miners were to double after the halving, they would generate approximately 70% and 60% respectively of gross profit margins.

During the week, Chhugani and Sapra have predicted that the overall market capitalization of cryptocurrencies could triple. 

Specifically reaching 7.5 trillion dollars by the end of 2025, driven by the Bitcoin and Ethereum ecosystems thanks to “unprecedented” institutional adoption.

“We predict that the total market capitalization of cryptocurrencies will reach $7.5 trillion by 2025, compared to the current $2.6 trillion, with Bitcoin ($3 trillion by 2025) and the Ethereum ecosystem ($1.8 trillion by 2025) as the main driving forces, along with major blockchains like Solana, Avax, etc. ($1.4 trillion by 2025).” 

They also predicted that the blockchain gaming sector would be “the killer consumer application of this cycle”, with gaming tokens reaching a market of 200 billion dollars.

Analysts have also initiated coverage on the Robinhood stock with an outperform rating, suggesting that it was “riding the wave of the return of cryptocurrencies” as a higher beta play.