Bernstein analysts believe bitcoin could set a fresh record of $150,000 by the middle of 2027, before climbing to about $300,000 at the high point of its next market cycle in 2029. They say a wider “debasement trade”, driven by concerns over government debt and pressure on currencies, could provide further support for the cryptocurrency.
In a note to clients on Wednesday, analysts led by Gautam Chhugani argued that the 40-year period of falling interest rates has ended. Governments are now dealing with higher debt-servicing costs, while US sovereign debt has reached $40tn.
“Rising yields create a self-reinforcing cycle of higher interest expenses, larger fiscal deficits, and increased borrowing needs, making debt sustainability a growing policy challenge,” the analysts said.
Bernstein expects policymakers eventually to choose currency debasement rather than allow fiscal pressures to intensify. That could increase demand for assets with limited supply and which cannot easily be created or diluted, including bitcoin.
The same investment theme is beginning to appear in exchange-traded fund activity. Eric Balchunas, Bloomberg’s senior ETF analyst, said on Tuesday that the “debasement trade is starting to replace AI mania”.
BlackRock’s spot bitcoin ETF, IBIT, and SPDR’s gold ETF, GLD, have returned to the 10 most actively traded ETFs. Their rise has pushed aside some semiconductor funds that had dominated the rankings during the summer.
Bernstein said bitcoin’s established holder base, improved access for institutional and retail investors, and a more supportive regulatory environment had strengthened its credentials as a “hard asset”.
About 59% of all bitcoin supply has not changed hands in the past year, according to the analysts. Bitcoin has also risen by 28% over the past 10 days, following an approximate 50% fall from its October 2025 peak.
The firm believes greater participation through spot bitcoin ETFs and purchases by companies adding bitcoin to their treasuries may have reduced the scale of the decline. Previous market cycles had seen falls of between 75% and 90%.
Two possible bitcoin scenarios
Bernstein’s central forecast assumes bitcoin continues to follow its traditional four-year cycle. Its valuation model measures the cryptocurrency against a multiple of the marginal cost of production.
On that basis, bitcoin is expected to return to about $125,000 by the end of 2026, reach $150,000 by mid-2027 and rise to approximately $300,000 in 2029.
The analysts also outlined a faster-growth scenario, based on a shift in the global macroeconomic environment. If institutional investors increase their bitcoin purchases in response to currency debasement, the cryptocurrency could reach $200,000 by mid-2027 and potentially peak at $500,000 in 2029.
Bernstein retained its longer-term projection of about $1m for bitcoin by the end of 2033.
The firm also kept its Outperform rating on Strategy, the bitcoin treasury company, but reduced its price target from $450 to $350. The change reflects Bernstein’s revised outlook for the bitcoin cycle and a faster pace of equity dilution.
The new target implies 176% upside from Strategy’s closing price of $126.83 on Tuesday.
Strategy currently holds 840,447 BTC, equivalent to roughly 4% of bitcoin’s total supply. Bernstein said the company’s stronger balance sheet gives it about 3.9 years of cash coverage for annual interest payments and preferred dividend commitments.
However, the analysts said sustained strength in bitcoin, combined with a recovery in Strategy’s STRC preferred stock towards $100, could allow the company to be “going kinetic again with bitcoin purchases.”
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