• Bitcoin could soar 337% to hit $150,000 by mid-2025, according to analysts at Bernstein.
• While April's halving will reduce supply, demand will jump on the potential approval of spot bitcoin ETFs.
• "You may not like bitcoin as much as we do, but a dispassionate view of bitcoin as a commodity suggests a turn of the cycle."

Bitcoin will soar 337% to $150,000 by mid-2025 as the world's largest cryptocurrency begins a new cycle, according to analysts at Bernstein.

In a note initiating coverage of crypto miners, Bernstein said bitcoin is on the brink of potentially big industry market moves, including bitcoin's upcoming halving and the likely approval of the first spot bitcoin ETFs.

"You may not like bitcoin as much as we do, but a dispassionate view of bitcoin as a commodity suggests a turn of the cycle," the report, led by Global Digital Senior Analyst Gautam Chhugani, said. "A good idea is only as good as its timing."

According to the note, bitcoin historically has rallied whenever there's a halving, a predetermined event in which the amount of bitcoin received for mining the crypto is slashed. This happens every four years, with the next halving set for April 2024. 

As halving essentially cuts down on bitcoin supply, crypto miners are less likely to sell accumulated tokens, because they anticipate higher future prices. Already, 70% of bitcoin tokens have not sold in the last 12 months, Bernstein pointed out.

At the same time, the currency is undergoing increased demand from new buyers, especially with the Securities and Exchange Commission expected to approve spot bitcoin ETFs soon.

Though the SEC originally tried to block such efforts, its rejection of a Grayscale crypto ETF was defeated in court in August, potentially paving the way for a regulatory turnabout.

"We expect US regulated ETFs to be the watershed moment for crypto and we expect a SEC approval by late 2023/Q1, 2024," Chhugani wrote. "Post halving, we expect the bitcoin spot demand via ETFs to outstrip miner selling by 6-7 times at peak. We expect bitcoin ETFs to be equivalent to 9-10% of spot bitcoin in circulation by 2028."

Analysts expect bitcoin to rally into the ETF approvals and the initial post-approval response, followed by some profit-taking going into halving, then a "major inflection" after halving.

Halving will also have implications on the crypto mining industry, leading to more consolidation. As the amount of rewarded tokens drops, high-cost miners will face the most pressure, and the least efficient of them will likely not survive, leading to consolidation.

Instead, Chhugani points investors towards two miners worth paying attention to: Riot and CleanSpark.

Calling them a "high-beta way to gain exposure," the note cited their low power cost in mining tokens, high liquidity, and unlevered balance sheets. Both were given outperform ratings.