Key Points:
- Tiger Research estimates Bitcoin could rise to $190,000 by the third quarter, voicing confidence in market dynamics fueled by ETF demand and new 401(k) investment access.
- The analysis expects approximately $90 billion in demand due to 401(k) allocations and a notable uptick in institutional accumulation.
- Even with optimistic forecasts, caution is advised as on-chain indicators suggest the market, though lively, is not currently overheated.
Detailed Insights:
Tiger Research projects a base price of $135,000 for Bitcoin, combining this with multipliers for fundamental factors (+3.5%) and macroeconomic conditions (+35%) to arrive at the $190,000 prediction, signifying a 67% increase from this week’s average of $113,000.
The report cites key market drivers:
- M2 money supply surpassing $90 trillion.
- ETF and corporate purchases now represent 6% of Bitcoin’s total supply.
- Regulatory support that opens U.S. retirement accounts to crypto assets.
The 401(k) exposure through a recent executive order sends a clear message of Bitcoin’s establishment as a fundamental institutional holding. A mere 1% allocation from the $8.9 trillion retirement asset pool would produce nearly $90 billion in demand.
Institutional interest is evident, with ETFs currently holding 1.3 million BTC, while companies like MicroStrategy possess over 629,000 BTC valued at around $71 billion. The buying strategies employed reflect a shift from retail to institutional participation, indicated by fewer transactions but larger sums.
Nevertheless, the report notes a potential imbalance within the network; daily transactions and active users are considerably beneath the peaks of the previous year, leading to diminished retail engagement. New ventures like BTCFi are necessary to stimulate activity beyond the institutions.
Cautionary signals from on-chain metrics, such as the MVRV-Z, which measures how far prices have exceeded initial holding costs, show a reading of 2.49—a level historically associated with price corrections. Similarly, the Adjusted Spent Output Profit Ratio (ASOPR) stands at 1.019, showing modest profits for sold coins, suggesting cautious profit-taking rather than extreme cash-outs.
Finally, the Net Unrealized Profit/Loss (NUPL) is at 0.558, indicating a steady but not euphoric market condition. Overall, the data reveals a heated market that is not yet overextended.
