AllianceBernstein Predicts Bitcoin Price to Hit $1 Million by 2033 Amid ETF Surge

• Bitcoin’s potential surge to $1 million is making headlines as experts foresee a paradigm shift in the cryptocurrency landscape.
• Financial analysts draw attention to the increasing institutional adoption fueled by US spot Bitcoin ETFs managed by leading asset managers.
• Key projections and historical patterns provide a compelling case for significant price movements in the coming years.

Discover the driving factors behind Bitcoin’s projected ascent to $1 million by 2033, with detailed insights into market dynamics, institutional influences, and historical price cycles.

Bitcoin’s Potential Path to $1 Million

Analysts Gautam Chhugani and Mahika Sapra from Bernstein have laid out a scenario projecting the assets under management in Bitcoin-related ETFs to rise dramatically to about $190 billion by 2025 from the current $60 billion. According to their report, “The introduction of US-regulated ETFs has marked a pivotal moment, channeling substantial new capital into crypto markets.”

The report indicates that by 2025, Bitcoin ETFs could represent approximately 7% of all Bitcoins in circulation, a share that could expand to 15% by 2033. This upsurge in institutional investment is expected to drive Bitcoin’s value upward significantly.

Bernstein’s analysis emphasizes Bitcoin’s supply dynamics, particularly the impact of halving events. The latest halving in April reduced the block reward from 6.25 BTC to 3.125 BTC, cutting the daily new supply from 900 BTC to 450 BTC. As Chhugani and Sapra explain, “Halvings reduce miner sell-pressure by half while new demand catalysts emerge, potentially leading to exponential price increases.”

Historical Price Patterns

Historically, halving events have preceded substantial price rallies in Bitcoin. In both the 2017 and 2021 cycles, significant price movements were observed post-halving. For the upcoming cycle from 2024 to 2027, Bernstein projects a bullish increase to 1.5 times Bitcoin’s marginal cost of production, suggesting a mid-cycle peak of $200,000 by mid-2025. Looking further ahead, they project Bitcoin could reach $500,000 by 2029 and surpass $1 million by 2033.

MicroStrategy’s Strategic Moves

Bernstein’s optimistic outlook extends to MicroStrategy, a company recognized for its aggressive Bitcoin acquisition strategy. The analysts have initiated coverage on MicroStrategy with an outperform rating, forecasting a stock price target of $2,890 by the end of 2025. Currently, MicroStrategy holds 214,400 BTC, equating to about 1.1% of Bitcoin’s circulating supply, valued at approximately $14.5 billion.

MicroStrategy funds its Bitcoin purchases through convertible notes, which are long-term debt instruments that can convert into stock. The analysts believe this strategy poses “limited liquidation risk” due to the current profitability of their Bitcoin holdings. They predict that MicroStrategy’s holdings could increase to 1.5% of Bitcoin’s circulating supply by 2025.

Conclusion

The forecast for Bitcoin’s price journey to $1 million by 2033 rests on meaningful market shifts, increasing institutional investment via ETFs, and historical price behaviors following halving events. Additionally, MicroStrategy’s steadfast acquisition strategy continues to highlight the growing institutional confidence in Bitcoin. As the cryptocurrency market evolves, these factors could significantly steer Bitcoin’s trajectory, offering a comprehensive outlook for investors and stakeholders alike.