Steno Research: Bitcoin is expected to perform strongly this quarter and in 2025

MicroStrategy’s (MSTR) current premium relative to its Bitcoin (BTC) holdings is unlikely to be sustained, Steno Research said in a report on Friday. “This belief is further supported by the diminishing effect of MicroStrategy’s recent stock split,” analyst Mads Eberhardt wrote, adding that the upcoming U.S. spot Bitcoin exchange-traded fund (ETF) options will also reduce investment Investors hold the stock rather than these ETFs. The software company founded by Michael Saylor did a 10-for-1 stock split in August, a move Steno credits with contributing to the recent rally. Steno noted that MicroStrategy’s premium relative to its Bitcoin reserves has recently surged to nearly 300%. This shows that the company's valuation "deviates significantly from a simple calculation of the fundamentals of its assets and business," the report said. As regulators become more friendly to Bitcoin and cryptocurrencies in general, investors may choose to hold Bitcoin directly instead of MicroStrategy stock. Steno said this regulatory trend is expected to continue if Donald Trump is re-elected. Bitcoin is expected to perform strongly this quarter and into 2025, meaning "higher buying demand is needed to maintain MicroStrategy's current premium." The report adds that MicroStrategy's current premium is unsustainable, especially considering that it spent much of the 2021 cryptocurrency bull run at a premium below 200%. (CoinDesk)