- Bernstein maintains a $150,000 target for Bitcoin amidst a slowdown in BTC-ETF inflows.
- Analysts find Ethereum an attractive buy, anticipating approval of an exchange-traded fund based on it after May 23.
- Experts forecast a threefold increase in cryptocurrency market capitalization over the next 18-24 months.
The slowdown in Bitcoin ETF inflows is expected to be short-lived before the first cryptocurrency’s price resumes its climb to $150,000, according to Bernstein, reports The Block.
On April 28, the net outflow from spot exchange-traded funds based on digital gold amounted to $83.6 million, according to SoSoValue. Since April, there has been a mixed trend.
“We do not consider the inflow slowdown a worrying trend. […] It is a short-term pause before ETFs become more integrated with private banking platforms, wealth advisors, and brokers,” the experts noted.
In their view, digital gold will need time to be established in the list of recommendations for diversifying investment portfolios, and platforms will need to prepare the groundwork for selling products from a compliance perspective.
Analysts reaffirmed the $150,000 target by the end of 2025, citing a net inflow of $12 billion into Bitcoin ETFs and the stable position of miners post-halving amidst market consolidation and normalization of transaction share in their revenues at around 10%.
Ethereum Prospects
Analysts also touched on Ethereum’s price prospects. They identified a potential rejection of spot ETF applications based on the second-largest cryptocurrency by market cap on May 23 [as the final deadline] as a bullish factor.
Experts noted that the SEC might reference unreliable correlation with the futures market, which, as in the case of Grayscale’s GBTC, would be overturned in court.
Alternatively, the Commission might deny it on the grounds of recognizing Ethereum as a security, which would contradict the position of the CFTC, which views the asset as a commodity. They recalled that futures based on the second-largest cryptocurrency are already traded on the CME.
Bernstein considers the risk-reward ratio in Ethereum attractive, given Bitcoin’s leading growth. According to them, confirmation of such expectations would “revive” L2 tokens like Arbitrum, Optimism, and Polygon.
Analysts view stETH as high beta and the restaking economy of EigenLayer as an additional incentive and acceleration for mastering this niche.
Tripling Cryptocurrency Capitalization
Experts confirmed the forecast for the total market value of digital assets to grow to $7.5 trillion in the next 18-24 months.
Earlier, analysts noted that Bitcoin is entering a “DeFi summer” similar to Ethereum in 2020, thanks to record fees due to the launch of Runes.
Analysts at Franklin Templeton previously identified the protocol alongside Ordinals, L2, and decentralized finance primitives as one of the main drivers of innovation revival in the first cryptocurrency.