Zacks Investment Ideas feature highlights: IBIT, Coinbase, MicroStrategy and Alphabet


For Immediate Release

Chicago, IL – April 12, 2024 – Today, Zacks Investment Ideas feature highlights iShares Bitcoin Trust IBIT, Coinbase COIN, MicroStrategy MSTR and Alphabet’s GOOGL.

Bitcoin & the Road to $100K (5 Catalysts)

Bitcoin is having another classic year of outperformance versus other asset classes. However, the bull market is far from over. Below are five catalysts that will drive the world’s largest cryptocurrency past $100k, including:

Widespread Institutional Adoption

Institutional adoption, the moment Bitcoin enthusiasts have waited for, is here. The Bitcoin ETF launch, which occurred earlier this year, was the most successful in history. ETFs such as the iShares Bitcoin Trust have attracted billions in inflows and have gained more than 70% since debuting. That said, the ETF debut has not only helped ETF operators and Bitcoin itself, but it has also led to massive earnings in the exchange custodian for these ETFs, Coinbase.

Meanwhile, MicroStrategy has soared nearly 1,000% (not a typo) in five years after adopting the “Bitcoin standard.” Finally, El Salvador is benefitting from purchasing millions in Bitcoin, Fidelity (one of the world’s largest asset managers) owns Bitcoin, and a European Bitcoin ETF is likely to be launched soon. Bitcoin adoption is here and is insatiable. The only question left to ask is, “Who will be next?”

Bitcoin Halving = Supply Constraint

While demand is likely to soar, supply will be constrained in 2024 due to the next “Bitcoin Halving” in April. A Bitcoin halving is an event that occurs approximately every four years, reducing the reward miners receive for validating and adding new blocks to the Bitcoin blockchain by half. One of the virtues of Bitcoin is its built-in “anti-inflationary” monetary policy.

The reduction in the rate at which new Bitcoins are created leads to a gradual decrease in the overall supply of newly minted Bitcoins. Though the number of halvings in Bitcoin’s history is only three, and history is no guarantor, the stats suggest that bulls should stay the course for at least the next year. Bitcoin has delivered at least triple-digit one year after the halving, including +7,715% in 2012/13, +283% in 2016/17, and +423% in 2020/21!

Election Year Seasonality

Equity investors often leverage historical seasonality trends to gain in edge in the market. Like with equities, investors can look to history to identify historical trends. For Bitcoin, the presidential election years (like the one we are in now) have been incredibly bullish. In the past three election years, Bitcoin returns were as follows: 2012 +272.4%, 2016 +161.1%, and 2020 +302.8%.

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Long-Term Breakout to New High

Investors often overcomplicate technical analysis, utilizing fancy indicators and ultimately suffering from “paralysis by analysis.” However, with Bitcoin, simplicity has paid dividends and has allowed investors to block out the day-to-day volatility and noise. Bitcoin is breaking out to fresh all-time highs for the first time in years. Each time these multi-year breakouts have occurred, Bitcoin has produced meteoric returns.

Rising Prices, But Less Hype (Sentiment)

Over the past year, Bitcoin is up some 131.72%, sparked the most successful ETF debut in Wall Street history, and broke out to new all-time highs. Nevertheless, Alphabet’s “Google Trends,” which measures the number of searches for a particular keyword, paints a much different picture than most investors would expect. First, artificial intelligence (AI) searches far supersede Bitcoin searches. Second, Bitcoin searches are about 75% lower than they were when the world’s first cryptocurrency peaked back in 2017. In other words, despite the bullish price action, there are few signs of “overexuberance.”

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.

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MicroStrategy Incorporated (MSTR) : Free Stock Analysis Report

Alphabet Inc. (GOOGL) : Free Stock Analysis Report

Coinbase Global, Inc. (COIN) : Free Stock Analysis Report

iShares Bitcoin Trust (IBIT): ETF Research Reports

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