Investor Interest in Crypto Ramps Up

Following discussions with various investors in the U.S., Bernstein analysts noted a resurgence in interest in cryptocurrencies, signaling that “crypto is back.”

Investor groups from diverse sectors, including finance, payments, and technology, are increasingly aware of the political changes under the Trump administration. However, the analysts indicated that investors lack specific awareness of the forthcoming transformative digital assets regulatory regime. “Things are still early, and we expect investors are just getting started on crypto,” said Gautam Chhugani, leading the analysis.

Discussions primarily centered around crypto-related stocks such as AI-diversified miners and crypto exchanges, along with factors influencing the price of Bitcoin. There was a notable interest in stablecoins, especially in light of potential new U.S. legislation.

Bernstein’s $200,000 Bitcoin Target and Market Trends

The conversation with investors highlighted Bernstein’s bullish Bitcoin price target of $200,000 by the end of 2025 and explored its implications on crypto exchanges, AI opportunities, stablecoins, and MicroStrategy.

The analysts pointed to regulatory catalysts like President Trump’s crypto executive order and SEC’s repeal of SAB 121, which allow U.S. banks to custody digital assets for the first time, as influencing potential market price gains. They projected that Bitcoin exchange-traded funds and corporate purchases could reach $120 billion in 2025, up from $60 billion in 2024, potentially driven by banks offering credit or leverage services against their digital asset holdings.

Interestingly, responses from institutional investors were neutral regarding Bitcoin prices, demonstrating no strong bullish or bearish sentiment. Equity investors remained focused on crypto-related equities due to challenges in directly buying spot Bitcoin or participation through ETFs.

Regarding crypto exchanges, Robinhood has emerged as a top performer, gaining 370% over the past year. Analysts view it as a key beneficiary of the crypto “deregulation” wave, anticipating it will competitively position itself against established exchanges like Coinbase and Kraken. The entry of traditional banks like Schwab into the market may pressure exchange fees, but Robinhood’s tactical pricing and broader token offerings may keep it ahead.

Interest in Bitcoin mining is intensifying, particularly around AI potential, with Core Scientific leading due to solid partnerships. Riot’s shift in strategy shows genuine intent for growth, especially given its lower valuation.

Stablecoin legislation is expected in 2025, which may enhance the U.S. dollar’s dominance online, driven by crypto markets and cross-border payments. Chhugani noted that banks and fintechs might adopt stablecoins for their promising revenue and financial integration prospects.

On the topic of MicroStrategy, many investors view it as overly leveraged in Bitcoin. However, analysts argue that the company has been a trailblazer in Bitcoin-linked capital markets, successfully issuing convertibles and planning preference shares for exposure.

Anticipating corporate Bitcoin purchases to rise to $50 billion in 2025, Bernstein rates MicroStrategy, Robinhood, Riot, CleanSpark, IREN, and Core Scientific as outperforming, with price targets of $600, $51, $22, $30, $26, and $17, respectively.

Gautam Chhugani retains long positions in multiple cryptocurrencies, while Bernstein may have financial ties to MicroStrategy, Riot Platforms, and Robinhood.