Investing.com — Bernstein analysts maintain a 12-month target price of $200,000 on the cryptocurrency; The $95,000 to $98,000 price range remains an “attractive” investment for prospective investors, he said. .
Bitcoin has risen 27% in the past 30 days and has since hit several all-time highs. Bitcoin experienced its first ever “leverage flush” after topping $100,000 last week as traders used the milestone to adjust their positions.
Analysts said the main reason for this decline was that traders increased leverage at the $100,000 level, giving bears an opportunity to reduce excessive speculative activity.
Analysts led by Gautam Chughani said in a note: “Bitcoin will likely take a small ‘holiday’ here before demand permanently breaks through the $100,000 barrier.”
The world's largest crypto asset continues to see strong demand from exchange-traded funds (ETFs) and corporate finance participants, led by MicroStrategy Incorporated (NASDAQ:).
MicroStrategy has continually raised equity and convertible debt to acquire Bitcoin and currently holds over 2% of the total Bitcoin supply. Its convertible bonds amount to about $7.3 billion, which is about 18% of Bitcoin's market value.
The Bitcoin convertible bond market pioneered by MicroStrategy is also gaining traction among other companies. Major Bitcoin miners such as Riot Platforms (NASDAQ:) and Marathon Digital (NASDAQ:) Holdings have begun issuing convertible bonds to fund their Bitcoin purchases.
Last week, MARA raised $1 billion in convertible debt at a 40% premium and 0% coupon. Similarly, Riot announced a $500 million convertible bond issue to purchase Bitcoin.
Analysts believe that the conversion market for Bitcoin is still in its infancy. Leverage levels of miners and MSTR are still quite low. Debt levels of RIOT and MARA have declined so far due to the bond market being closed. is either zero or negligible.” For businesses focused on Bitcoin. ”
The company added that most of the debt-laden miners during the 2021-2022 cycle either exited the market or came back in a stronger financial position, including Core Scientific (NASDAQ: ) were listed.
Analysts believe that these trends, combined with continued ETF demand, create a consistent source of Bitcoin purchases that significantly exceed current supply levels.
