Berenberg Capital Markets, a New York-based investment firm, expressed its optimistic outlook on MicroStrategy, with a price target of $430. They underscored that MicroStrategy’s primary value lies in its ownership of 152,333 Bitcoin as of June 28. A rally triggered by the Bitcoin halving could lead to a significant increase in MicroStrategy’s stock price.
Based on historical trends, it’s anticipated that the price of Bitcoin will follow its established pattern of rallying before and after each halving event. The next Bitcoin halving is scheduled for April 26, 2024, and it will reduce the issuance rate of BTC by 50%, thereby slowing down the introduction of new Bitcoin into the cryptocurrency market.
The research note stated, “If the historical pattern established by the first three bitcoin halvings continues to play out with the fourth halving, then the pre-halving rally would begin about four months from now.”
Last Bitcoin ETF decision deadline: 3/19/24
Bitcoin halving estimate: 4/16/24
— Will Clemente (@WClementeIII) July 10, 2023
Previous halving cycles have resulted in Bitcoin prices surging by a minimum of 682%. For instance, during the first Bitcoin halving on November 28, 2012, the price of Bitcoin was around $12. After 367 days, it reached a peak of $1,164.
While the supply of Bitcoin follows a predetermined path, the potential magnitude of a future rally depends on the overall demand for Bitcoin. They pointed to the recent increase in applications for spot Bitcoin ETFs from prominent asset managers as evidence of the growing institutional adoption of Bitcoin.
The research note also highlighted the favourable comments made by BlackRock CEO Larry Fink on July 5, which suggested his strong belief in Bitcoin. Currently, MicroStrategy shares are trading at $408, reflecting a gain of nearly 180% since the beginning of 2023. Meanwhile, the price of Bitcoin has risen by 84% since the start of the year, according to TradingView data.