Berenberg Capital Predicts Bitcoin Halving to Boost MicroStrategy’s Bullish Stance

New York-based investment firm Berenberg Capital Markets has expressed a positive stance on MicroStrategy (MSTR), the tech firm founded by Michael Saylor, citing the upcoming Bitcoin halving as a potential catalyst. In a research note, Berenberg outlined its reasons for a bullish outlook, setting a price target of $430 for MicroStrategy.

Berenberg analysts highlighted that MicroStrategy’s value largely stems from its substantial Bitcoin holdings, which stood at 152,333 BTC as of June 28. They noted that a rally associated with the Bitcoin halving could lead to significant price gains for MicroStrategy shares.

The Bitcoin halving, slated for April 26, 2024, reduces the issuance rate of BTC by 50%, thereby slowing down the rate at which new Bitcoin enters the market. Berenberg’s note suggested that based on historical patterns, a rally could potentially commence around four months before the halving.

Citing previous halving cycles, the analysts pointed out that Bitcoin’s price surged by a minimum of 682%. For instance, during the first halving on November 28, 2012, Bitcoin traded at around $12. After 367 days, its price peaked at $1,164.

While acknowledging that Bitcoin’s supply follows a predetermined path, Berenberg emphasized the need to assess the overall demand for Bitcoin to gauge the potential magnitude of a future rally. The research highlighted the recent increase in spot Bitcoin ETF applications from prominent asset managers as evidence of growing institutional adoption.

Furthermore, the note drew attention to the pro-Bitcoin statements made by BlackRock CEO Larry Fink on July 5, characterizing him as exhibiting strong confidence in Bitcoin. These developments signal a potential shift towards increased institutional interest in the cryptocurrency.

In conclusion, Berenberg Capital Markets anticipates a bullish trajectory for MicroStrategy in light of the upcoming Bitcoin halving. The research note underlines the historical patterns of previous halvings and the growing institutional adoption of Bitcoin as factors contributing to the positive outlook.

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