MicroStrategy Could Own 4% of Bitcoin Supply by 2033, Analysts Say
MicroStrategy's Bitcoin strategy is evolving, with analysts at Bernstein predicting the company could own 4% of the circulating supply within ten years. Currently, MicroStrategy holds 331,200 BTC, representing 1.7% of the total supply, acquired at an average price of $49,874.
Bernstein analysts, led by Gautam Chhugani, praised MicroStrategy's aggressive acquisition approach, noting it aims to attract significant global capital for Bitcoin investment. They have adjusted their price target for MicroStrategy Inc (NASDAQ: MSTR) stock, projecting a 42% increase from its current price of $421.88 to $600 by the end of 2025.
Reasons for Analyst Optimism
Bernstein’s positive outlook is based on three key factors:
- Investor sentiment regarding Bitcoin positioning.
- MicroStrategy's liquidity and insolvency risk assessment.
- The firm’s capability to scale capital over time.
Analysts believe that the Bitcoin bull market has entered a sustained phase, supported by increasing institutional adoption and favorable regulations amid low interest rates and minimal inflation risks. They assessed that MicroStrategy's convertible debt model mitigates balance sheet risks despite Bitcoin's volatility.
Additionally, MicroStrategy raised $9.6 billion in debt and equity recently, significantly advancing towards its $42 billion capital raise goal over the next three years, with expectations to complete this within 18 months.
MicroStrategy aims to hold approximately 830,000 BTC by 2033, potentially valuing these holdings at $1 million per Bitcoin, translating to $830 billion in total value.
Skepticism in the Market
Despite Bernstein's optimism, not all analysts share this view. Citron Research criticized the rapid rise of MicroStrategy's MSTR stock, suggesting it may be disconnected from Bitcoin fundamentals. Their concerns contributed to a 20% drop in MicroStrategy shares last week. However, with Bitcoin trading around $98,629 and MSTR stock increasing by over 500% this year, MicroStrategy's investments in Bitcoin appear to be yielding results, notwithstanding market skepticism.