- Bitcoin ETFs and institutional investments are fueling a strong new bull market phase.
- Regulatory changes and pro-crypto policies are driving Bitcoin’s price to new highs
- Bitcoin is emerging as a rival to gold, with nations considering it for their reserves.
Bernstein’s analysts suggest Bitcoin is on the cusp of the next bull market phase. According to the company, new opportunities are emerging in Bitcoin and related equities. Notably, the market turned upward in late 2023, right after the U.S. allowed spot Bitcoin exchange-traded funds.
After launching on January 11, 2024, Bitcoin’s price increased from around $25,000 to $46,000. According to Bernstein, Bitcoin will grow more due to forthcoming positive influences.
Institutional Investments and Bitcoin ETFs Fuel Market Growth
As Bernstein explains, significant inflows into Bitcoin ETFs are impacting the cryptocurrency’s price. After slight consolidation, Bitcoin peaked at an all-time high of nearly $109,000. One of the most critical catalysts for this surge was Donald Trump’s presidential victory and promise to implement a national Bitcoin reserve. His pro-crypto stance has injected more confidence into the market and attracted more investors.
The creation of a national Bitcoin reserve is seen as another key driver of Bitcoin’s price movement. Bernstein proposes that the Federal Reserve or the U.S. Treasury could take the initiative by reserving digital assets. To finance these acquisitions, the government can sell some of its gold or issue debts. Moreover, Bitcoins confiscated from illegal operations can be included in the reserve, which would also improve the faith in the market.
Changing Regulations and Increasing Interest from Institutions
Increased institutional attention and regulation changes are other elements likely to fuel growth in bitcoin demand. Several key players have invested heavily in Bitcoin ETFs in the past few weeks. For instance, the Mubadala Sovereign Wealth Fund has invested over $437 million in Bitcoin ETFs. Other notable rivals like Goldman Sachs and Barclays are betting more on Bitcoin. These moves indicate that a growing number of large institutions will embrace this asset class and that it will positively impact prices.
Moreover, the SEC’s repeal of SAB 121 allows banks to store cryptocurrency. This change makes it easier for more institutions to invest in digital assets. As more institutions join the market, digital asset’s price will likely rise. Bernstein’s analysts predict that Bitcoin will continue to grow as governments and institutions invest more heavily in the asset.
With digital asset’s market value growing, some view it as a competitor to gold. According to Bernstein, Bitcoin could reach higher prices as more countries add it to their reserves.
