Key Takeaways
-
Shares of big bitcoin buyer Strategy have recovered recently, edging out the S&P 500 year-to-date—and outperforming bitcoin itself.
-
The price of bitcoin is hovering around $77,000, down about 12% so far this year. Strategy’s Michael Saylor predicts a rally.
One bitcoin whale sees a rally coming.
Michael Saylor, executive chair of Strategy (MSTR) and one of bitcoin’s most high-profile backers, said prices bottomed around $60,000—they came within a few hundred bucks of that level in February, perhaps the chilliest part of the recent “crypto winter,” according to Messari—and that the market is moving into a “spring phase.”
“We’ll rally from here,” Saylor said in an interview with CNBC Thursday. Bitcoin, he said, “going up forever.”
WHY THIS MATTERS TO INVESTORS
Strategy chair Saylor has long held a bullish stance on bitcoin, but he also recently pivoted the company’s buy-and-hold strategy, saying the bitcoin treasury firm may sell the cryptocurrency.
The leading cryptocurrency, which according to CoinMarketCap has a market value of about $1.54 trillion, has has regained ground lost after sliding from its all-time high in October. More recently, it has struggled to stay above $80,000 and has been hovering under that mark. Net spot bitcoin ETF flows, one of the bigger drivers of the coin’s price lately, have been negative for four consecutive business days through yesterday, with roughly $1.3 billion of capital rushing out, according to Farside Investors data.
Saylor said he expects Strategy’s stock—the company holds bitcoin, has a software business and offers a range of financial products—to “outperform bitcoin.” That’s been the case this year, with the stock up 10% through Wednesday’s close, ahead of the S&P 500’s 7% rise. Bitcoin is down 12% over the same period.
Saylor said macroeconomic tailwinds include the passage of the Clarity Act. The bill, which sets up a regulatory framework for digital assets, last week took an incremental step toward becoming law as the Senate moved a draft version out of committee. The development initially drove prices above $80,000. Saylor said the Securities and Exchange Commission’s so-called “innovation exemption” for tokenized stocks could also help; the agency is moving toward allowing the trading of tokenized assets on decentralized crypto platforms, according to Bloomberg.
Strategy stock and bitcoin are roughly flat Thursday.
Read the original article on Investopedia
