Analysts forecast that the next pre-halving rally in Bitcoin could start in the next four months, potentially increasing the value of firms with a focus on the currency, including Michael Saylor’s technology. New York-based investment firm Berenberg Capital Market initiated a positive outlook on MicroStrategy in a research report. They also assigned a price target of $430 for the company’s stock.
The analysts highlighted MicroStrategy’s substantial Bitcoin holdings, totaling 152,333 BTC as of June 28.
These holdings are identified as the primary driver of the company’s value.
“We expect that the price of Bitcoin will repeat its historical pattern of rallying both ahead of and following each Bitcoin halving”
This emphasizes that a Bitcoin halving may lead to big price increases for MicroStrategy’s shares.
Scheduled for April 26, 2024, the Bitcoin halving event will reduce the rate of new Bitcoin issuance by 50%.
This decrease will restrict the influx of new Bitcoin into the cryptocurrency market. Based on historical trends, the research note suggests that the pre-halving rally could commence in approximately four months. If past halvings are any indication, this timing pattern is expected to persist. The price of Bitcoin increased by at least 682% throughout previous halving rounds, according to Berenberg. Following the first Bitcoin halving on November 28, 2012, the price surged from around $12 to reach a peak of $1,164 within 367 days.
Anticipated Bitcoin Halving Boost: MicroStrategy’s Bright Outlook
The entire demand for Bitcoin must be taken into account to evaluate the possible size of a future rally, even though the supply of Bitcoin follows a predefined route. The study referenced the increasing number of spot Bitcoin ETF applications by renowned asset managers. This trend was seen as a clear indication of the growing institutional adoption of Bitcoin.
The report also referred to BlackRock CEO Larry Fink’s pro-Bitcoin remarks from July 5, comparing them to those of a “high-conviction Bitcoin maximalist”. Along with colleagues Matthew Laflash and Hassan Saleem, the investor note was written by stock analyst Mark Palmer.
According to statistics fromTradingView, MicroStrategy’s shares have increased by around 180% since the beginning of 2023 and are currently trading at $408. The cost of Bitcoin has increased by 84% throughout the same time frame. The prognosis for MicroStrategy is still bright as the Bitcoin market gets ready for the anticipated pre-halving bounce. The business is well-positioned to profit from any prospective upward momentum in the cryptocurrency industry.