Bernstein: Bitcoin will hit new highs as companies increase holdings and ETF "supply crunch" intensifies

Odaily Planet Daily News This year, the Bitcoin price narrative fluctuates between the correlation of "gold" and "Nasdaq", but Bernstein analysts believe that short-term correlation is highly misleading. The exhaustion of retail selling, the tide of corporate holdings and the return of ETF funds are the key indicators, which may drive "supply tightening" to new highs. Last week, Twenty One Capital announced an initial hoard of 42,000 BTC (about US$4 billion), joining the competition of companies such as Strategy. Currently, about 80 companies hold a total of 700,000 BTC, accounting for 3.4% of the total supply. The US spot Bitcoin ETF had a net inflow of US$3 billion last week, a five-month high, and the total holdings accounted for 5.5% of the circulation of Bitcoin. The proportion of institutions increased from 20% in September last year to 33%, of which 48% were held by investment advisors, reflecting the demand for asset allocation. Combined with corporate holdings, institutional capital has controlled 9% of the BTC supply. If the US government implements strategic reserves, it may trigger sovereign countries to compete to hoard coins. The proportion of BTC balances on exchanges has dropped from 16% to 13% at the end of 2023, but some assets have only been transferred to ETF custodians. Bernstein analysts estimate that Bitcoin will reach a cyclical peak of about $200,000 by the end of 2025, $500,000 by the end of 2029, and $1 million by the end of 2033, with intermittent one-year bear markets. (The Block)