Analysts at research and brokerage firm Bernstein expect bitcoin to resume its bullish trajectory post-halving, reiterating their target of $150,000 by the end of 2025.

“We expect bitcoin's bullish trajectory to resume post-halving, when the mining hash rates have adjusted and ETF inflows resume back (negative to flat flows last 10 days),” Gautam Chhugani and Mahika Sapra wrote in a note to clients on Wednesday. “Further, integration of spot bitcoin ETFs with wirehouses, RIAs will continue to provide structural demand for bitcoin, in our view. We continue to expect bitcoin to touch a cycle high of $150,000 by 2025.”

This view mirrors that of Bloomberg ETF analyst Eric Balchunas, who told The Block last month that making the spot bitcoin exchange-traded funds accessible on significant wirehouse platforms — which he identified as looking after between $7 trillion and $10 trillion in assets — was “like putting a product on the shelf of Whole Foods or a big food store. Just that kind of exposure and availability is only going to help.”

Balchunas expects the spot bitcoin ETFs to land on such platforms in the next few months, also identifying options trading for the ETFs as another major catalyst.

The impact of halvings on price

Historically, Bitcoin BTC +1.78% halvings have been associated with significant fluctuations in the cryptocurrency's price. While not a direct cause-and-effect relationship, these events have often preceded substantial bull runs in the bitcoin market.

Bitcoin price post-halving. Image: Bernstein.

The Bernstein analysts said that the halving itself does not lead to bitcoin price appreciation without new demand. While the miners will earn less bitcoin in subsidy rewards post-halving and, therefore, have less to sell to the market, this potential sell pressure has fallen significantly over time.

“For example, at today’s price ~$50 million of bitcoin is produced/earned by miners daily. This is merely 0.12% of daily bitcoin trading volume. Thus, decreased sell pressure is no longer a meaningful argument for bitcoin price appreciation in the halving year. We believe it is always new demand catalysts that lead to bitcoin price appreciation in every cycle,” they said.

Chhugani and Sapra added that demand catalysts have often synchronized with new supply reductions following halving events, citing post-pandemic liquidity and corporate purchases of bitcoin by Tesla, Square and MicroStrategy in the 2020/21 cycle, with this cycle led by the spot bitcoin ETF approvals and leading global asset managers driving demand.

“Historically, a bitcoin price breakout has always followed the halving event and sometimes a few months after halving. However, in the current 2024 cycle, the ETF approvals in January led to strong price appreciation pre-halving (BTC 50% up since leading to all-time highs). Only in the last 10 days with slower ETF inflows (and significant GBTC selling), has bitcoin corrected ~15%,” they said.

Overall flows for the spot bitcoin ETFs have slowed since peaking at a net daily inflow of $1.05 billion on March 12, as bitcoin approached its latest all-time high of $73,836, according to The Block’s data dashboard.

Bitcoin is currently trading 14% down from its all-time high at $63,508, according to The Block’s price page.

BTC/USD price chart. Image: The Block/TradingView.

The impact on miners

Amid negative headlines on miner revenue impact, with many stocks down 15-20% over the last 30 days and not a single public miner outperforming bitcoin year-to-date, some miners are still at all-time highs in terms of U.S. dollar revenue, providing a solid balance sheet pre-halving alongside relatively low debt.

Bernstein expects around 7% of the network hash rate to shut down post-halving as less efficient mining operations become unprofitable and the industry consolidates toward four leading public miners: CleanSpark, Marathon, Riot Platforms and Cipher Mining.

The predicted moderate reduction is due to strong price action following the ETFs' launch increasing dollar revenues, miners now earning 8-10% of revenues from transaction fees following renewed interest from application developers, Layer 2 scaling infrastructure teams and NFTs, and miners not being leveraged this cycle, the analysts said.

However, “If the bitcoin price sees a material drawdown — back to $40,000 levels or lower — we could see a more drastic reduction in network hash rate. We believe the chances of this adverse scenario are lower, given structural ETF demand is far from done, in our view ($12 billion actual inflow YTD vs $80 billion inflow estimate over 2024-25),” they added.

The analysts reiterated their view that post-halving, amid increased market share, strong revenues and a growing capacity pipeline, the top public miners could outperform bitcoin over the next 12 months.

Bitcoin’s halving countdown

Bitcoin’s next halving event is now less than three days or 374 blocks away, according to The Block’s Bitcoin Halving Countdown page — setting a potential date of April 20 at around 0:15 a.m. UTC (8:15 p.m. ET on April 19), as things stand.

Bitcoin halvings are programmed to occur automatically every 210,000 blocks — roughly every four years. Once a halving event occurs, miners receive 50% fewer bitcoins as a subsidy reward for every block of transactions they mine and add to the blockchain. Bitcoin’s next halving event will see the subsidy reward for miners on the network drop from 6.25 BTC to 3.125 BTC per block. However, they continue to earn additional transaction fee rewards for each block mined as normal.