Slowing Bitcoin ETF Flows No Cause for Concern, Maintains $150,000 Price Target: Bernstein Analysts

Bernstein analysts are confident in Bitcoin’s future trajectory despite a recent slowdown in spot bitcoin exchange-traded fund (ETF) flows. They maintain a bullish outlook and reaffirm their $150,000 price target for the cryptocurrency by the end of 2025. 

The analysts view the current ETF flow deceleration as a temporary pause, anticipating that ETFs will become more integrated with various financial platforms. This perspective underscores their conviction in Bitcoin’s long-term growth potential despite short-term fluctuations in ETF activity.

Slowing Bitcoin ETF Flows: A Temporary Pause

In their recent analysis, Bernstein analysts Gautam Chhugani and Mahika Sapra acknowledge the deceleration in spot bitcoin ETF flows, noting a decrease since the launch of ETFs.

The influx of funds into spot bitcoin ETFs has significantly decreased after reaching a peak net daily inflow of $1.05 billion on March 12, coinciding with bitcoin’s approach to its recent all-time high of $73,836.

They attribute this slowdown to the “halving” catalyst and the successful ETF launch, which may have pulled forward returns year-to-date (up 46%). Despite this trend, the analysts do not view the deceleration as a concerning development. Instead, they see it as a brief interruption before ETFs become widely adopted across private bank platforms, wealth advisors, and brokerage platforms.

The analysts remain steadfast in their bullish outlook for Bitcoin, citing the $12 billion spot Bitcoin ETF net inflows to date as a positive indicator. They also highlight the healthy position of leading Bitcoin miners post-halving and the normalization of transaction fees at around 10% of miner revenues. These factors contribute to their confidence in Bitcoin’s ability to reach their $150,000 cycle target by the end of 2025.

Ethereum ETF Denials

Beyond Bitcoin, the analysts discuss the potential impact of spot Ethereum ETF denials on the cryptocurrency market.

Bernstein analysts suggest that if the SEC denies spot Ethereum ETFs due to an alleged unreliable correlation between spot and futures markets, such a decision would likely be challenged in court, much like the outcome of the Grayscale Bitcoin ETF case.

Alternatively, if the SEC denies approval based on classifying ether as a security, it would create a complex scenario, especially given the existing trading of ether futures on the Chicago Mercantile Exchange (CME) without any securities implications.

Additionally, the analysts view ether staking through platforms like Lido as a high-potential opportunity with high-beta returns. They also anticipate that the potential launch of the Eigen token could further drive adoption and incentivize participation in the cryptocurrency market.

Total Crypto Market Cap Projections

Crypto market cap: Bernstein.

The analysts predict significant growth in the total crypto market cap, expecting it to triple to $7.5 trillion over the next 18 to 24 months. They highlight several crypto niches and projects with substantial growth potential, including Solana, Uniswap, GMX, Synthetix, and the Ronin blockchain. 

They also mention the growing market for tokenized government securities, noting the significant assets under management in tokenized funds.

Despite the recent slowdown in Bitcoin ETF flows, Bernstein analysts remain optimistic about the cryptocurrency’s future. They view the current deceleration as a temporary pause and maintain their $150,000 price target for Bitcoin by the end of 2025. The analysts also see potential bullish outcomes for Ethereum and anticipate significant growth in the total crypto market cap in the coming years.