Bitcoin Bulls Charge Ahead: Bernstein Sees $200K by Year-End

Bitcoin's bull market is poised to continue, according to analysts at Bernstein, who believe that a confluence of positive catalysts is setting the stage for the next leg of the rally. The research and brokerage firm's analysts, Gautam Chhugani, Mahika Sapra, and Sanskar Chindalia, have identified several factors that could drive Bitcoin's price higher in the coming months.

The current bull market began in the fourth quarter of 2023, fueled by anticipation of spot Bitcoin exchange-traded fund (ETF) approval in the United States. This anticipation, along with the subsequent launch of these ETFs on January 11, 2024, pushed Bitcoin's price from around $25,000 to over $46,000. The massive inflows into these ETFs created a tailwind for Bitcoin, driving its price to a record high of approximately $74,000 before a temporary pullback.

The victory of pro-crypto Donald Trump in the November presidential election further boosted Bitcoin's price. Trump's campaign promises to make the U.S. the world's crypto capital and establish a national Bitcoin stockpile resonated with investors, leading to a historic high of $108,786 on Trump's swearing-in day.

Bernstein analysts expect the next leg of the Bitcoin bull market to be driven by a confluence of positive catalysts, including the establishment of a National Bitcoin Reserve by Trump's AI and crypto Czar, David Sacks. They also highlight other tailwinds, such as Abu Dhabi's sovereign wealth fund purchasing Bitcoin via ETFs, the recent $742 million BTC purchase by Strategy (formerly MicroStrategy), and the repeal of SAB 121 by the U.S. Securities and Exchange Commission, which now allows crypto custody by banks.

The analysts at Bernstein believe that the growing adoption of Bitcoin by banks, institutional investors, corporates, and eventually sovereigns positions it as a clear challenger to gold. With Bitcoin's market value at $2 trillion compared to gold's $18 trillion, they see asymmetric upside for Bitcoin's price.

Previously, Bernstein analysts have forecasted that the Bitcoin price could reach $200,000 per coin by the end of this year, reflecting their bullish outlook on the cryptocurrency's prospects.