Bernstein Projects Strategy Holdings Skyrocket To 1 Million BTC By 2033

Analysts at Bernstein have made a bold prediction regarding MicroStrategy, now known as Strategy, the Bitcoin proxy firm co-founded by Michael Saylor. They forecast that it could amass over 1 million Bitcoin (BTC) by 2033, potentially positioning Strategy to hold 5% of BTC’s total supply. 

Led by analyst Gautam Chhugani, Bernstein’s research note reflects an updated bullish case based on Strategy’s strong Q4 financial results and its recent aggressive Bitcoin purchases. 

The firm has assigned an “outperform” rating to Strategy’s stock (MSTR) with a price target of $600, suggesting a potential upside of 75% from its current trading level.As of now, Strategy’s stock is priced at $335.26, having experienced a slight decline of 2.09% recently. 

Bernstein’s analysis indicates that Bitcoin could reach $200,000 by the end of 2025, $500,000 by 2029, and soar to $1 million by 2033, reflecting a potential 1,044% increase for the market’s leading cryptocurrency in the next 8 years from current valuations. 

This projected growth in Bitcoin’s value is expected to significantly enhance Strategy’s earnings per share, which are anticipated to rise to $207, up from the current $67.50.

In a “bull case” scenario, the analysts predict that Strategy’s Bitcoin holdings could increase to represent 5.8% of the current circulating supply of approximately 19.8 million BTC, compared to only 2.5% at present, assuming favorable capital market conditions with low interest rates and a sustained bull cycle in cryptocurrency.

However, with this growth comes a substantial increase in debt, which Bernstein estimates could reach $100 billion, coupled with equity proceeds of around $84 billion. 

In a more conservative base case, the analysts expect Strategy’s holdings to climb to about 4% of Bitcoin’s circulating supply, while a bear case could see stagnation at approximately 2.6%, potentially leading to forced liquidations of assets.

As of March 25, Strategy owned 506,137 Bitcoin, acquired at an average price of $66,608, which equates to a total value of around $33.7 billion. Recently, the company made headlines by purchasing an additional 6,911 BTC for $584.1 million through a combination of selling MSTR stock and issuing perpetual preferred shares (noted as STRK and STRF). 

Bernstein views Strategy’s Bitcoin treasury as a core component of its business model, despite facing challenges related to its premium-to-net asset value (NAV) valuation and the aggressive pace of its Bitcoin acquisitions. 

On Tuesday, Strategy’s shares closed at $341.81, reflecting a gain of 1.8%, reinforcing its position as a key player in institutional Bitcoin accumulation.

Similarly, Bitcoin has also seen a 5% increase in the fourteen day time frame, trading at $87,470 at the time of writing.

Featured image from DALL-E, chart from TradingView.com