Initiation of Coverage: Bitcoin EUR (BTC_EUR)

Recommendation: BUY

12-Month Price Target: €138,000

We initiate coverage on Bitcoin (BTC_EUR) with a BUY rating and a 12-month price target of €138,000, representing a potential upside of 76.8% from the current price of €78,050. Our thesis is anchored in Bitcoin’s accelerating institutional adoption, its continued role as a digital store of value amidst macroeconomic uncertainty, and the inherent scarcity driven by its programmatic supply schedule.

Key Data & Forecast Snapshot

• Ticker: BTC_EUR
• Current Price: €78,050
• 24h Change: +1.77%
• Market Cap: €1,559.5 billion
• 24h Volume: €23.4 billion

12-Month Forecast

• Price Target: €138,000
• Potential Upside: +76.8% (Calculation: (€138,000 / €78,050) – 1)
• Target Market Cap: €2,757.2 billion (Calculation: Current Circulating Supply (estimated 19,980,477 BTC) * €138,000)
• Recommendation: BUY
• Rating: High Conviction

Investment Thesis

Bitcoin stands at an inflection point, transitioning from a niche digital asset to a mainstream institutional investment vehicle. We believe its unique characteristics, combined with a supportive macro backdrop and structural market catalysts, position it for significant appreciation over the next 12-36 months.

• Accelerating Institutional Adoption: The approval and subsequent success of U.S. Spot Bitcoin ETFs have dramatically expanded access for institutional capital. This paradigm shift provides unprecedented liquidity and a regulated pathway for traditional finance to allocate to Bitcoin. We expect this trend to intensify through 2025-2026, as evidenced by commentary from firms like Cantor Fitzgerald and State Street Global Advisors (Source: Pymnts.com, Ainvest.com, SSGA).
• Digital Scarcity & Halving Mechanics: Bitcoin’s hard-capped supply of 21 million units and its programmed halving events create unparalleled digital scarcity. The most recent halving in April 2024 further reduced the new supply, historically acting as a catalyst for price appreciation due to a supply shock against persistent demand.
• Macroeconomic Hedge & Store of Value: In an environment characterized by increasing sovereign debt, potential fiat currency debasement, and geopolitical uncertainty, Bitcoin’s uncorrelated nature and censorship resistance offer a compelling alternative store of value. It increasingly competes with traditional safe-haven assets like gold for investor capital.
• Growing Network Effects: Continuous development, increasing user adoption (unique addresses), and rising hash rate (network security) strengthen Bitcoin’s underlying utility and resilience, reinforcing its long-term value proposition.

Investment Positives

1. Institutional Inflows via Spot ETFs: The success of Spot Bitcoin ETFs, particularly in the U.S., has created a robust, regulated, and accessible channel for institutional investors. This has driven significant net inflows, absorbing newly mined supply and indicating sustained demand (Source: Ainvest.com). We expect this trend to broaden globally with potential ETF approvals in other jurisdictions.
2. Post-Halving Supply Dynamics: The April 2024 halving event cut the daily issuance of new Bitcoin by 50%. Historically, post-halving periods have been followed by significant price rallies as supply constriction meets sustained or increasing demand. This fundamental supply shock provides a strong tailwind for price appreciation through 2025.
3. Inflationary & Monetary Policy Backdrop: Persistent global inflationary pressures and expansionary monetary policies by central banks continue to devalue fiat currencies. Bitcoin’s fixed supply offers a credible hedge against inflation and a non-sovereign store of value, attracting investors seeking to preserve purchasing power.
4. Global Accessibility & Decentralization: Bitcoin’s open-source, decentralized nature ensures global accessibility without intermediaries, making it resistant to censorship and single points of failure. This underpins its long-term viability and utility as a global, permissionless value transfer network.

Competitive/Peer Analysis

Bitcoin vs. Gold

• Digital Scarcity vs. Physical Scarcity: Both Bitcoin and Gold are scarce assets. Gold’s scarcity is geological, while Bitcoin’s is programmatic and verifiable on-chain. Bitcoin’s hard cap of 21 million units offers a superior, provable scarcity model.
• Portability & Divisibility: Bitcoin excels in portability (transferred digitally anywhere globally) and divisibility (into 100 million satoshis), far surpassing physical gold.
• Transparency & Verifiability: Bitcoin’s supply and transaction history are transparent on its public ledger. Gold’s supply is opaque, and its purity/provenance requires expert verification.
• Storage Costs: Bitcoin has negligible storage costs once secured in a digital wallet. Gold requires physical storage, often incurring significant costs and security risks.
• Volatility: Bitcoin exhibits significantly higher price volatility than gold, reflecting its nascent market maturity and faster adoption curve.

Bitcoin vs. Ethereum (ETH)

• Core Function: Bitcoin primarily functions as a decentralized digital store of value and peer-to-peer electronic cash. Ethereum, while also a digital asset, is fundamentally a smart contract platform designed to support decentralized applications (dApps) and various token standards.
• Monetary Policy: Bitcoin has a predictable, disinflationary monetary policy with fixed supply and halving cycles. Ethereum’s monetary policy has evolved (e.g., EIP-1559 burn mechanism, Merge to Proof-of-Stake) aiming for disinflationary economics, but its total supply is not hard-capped.
• Network Security: Bitcoin’s Proof-of-Work (PoW) consensus mechanism is designed for maximal security and resistance to attack, prioritizing immutability. Ethereum’s transition to Proof-of-Stake (PoS) offers different security trade-offs, focusing on scalability and energy efficiency.
• Risk Profile: While both are volatile, Bitcoin generally carries a lower technological and developmental risk due to its established and largely static protocol. Ethereum, being a platform for innovation, is subject to continuous development, upgrades, and potential competition from other smart contract platforms.

Estimates & Operating Assumptions (3-Year Forward Looking)

Our estimates reflect sustained institutional demand, the impact of the April 2024 halving, and Bitcoin’s increasing mainstream acceptance. We project price appreciation driven by supply-demand dynamics and network growth.

Price Estimates (BTC_EUR)

• 12 Months (Mid-2025): €138,000
• 24 Months (Mid-2026): €179,400 (Represents ~30% growth from 12m target, reflecting continued institutional adoption and post-halving momentum).
• 36 Months (Mid-2027): €220,000 (Represents ~22.6% growth from 24m target, as market matures and liquidity deepens).

Key Operating Assumptions (Estimates)

• Circulating Supply: Assumed to remain relatively stable at ~19.98 million BTC, with minor increases from mining rewards.
• Hash Rate Growth: Projected to increase by 15-20% annually over the forecast period, reflecting continued miner investment due to rising prices and network security demand.
• Unique Addresses: Expected to grow by 20-25% annually, indicating broader user adoption and network expansion.
• Institutional AUM in Bitcoin Products: Forecasted to grow at a CAGR of 50%+ over the next three years, driven by continued ETF inflows and broader institutional allocation strategies.
• Regulatory Clarity: Assumed to improve incrementally in major jurisdictions, fostering greater institutional confidence and reducing regulatory arbitrage.
• Macroeconomic Environment: Assumed to remain supportive of alternative assets, with ongoing concerns regarding inflation and sovereign debt.

Valuation

We employ a multi-faceted valuation approach for Bitcoin, recognizing its unique characteristics as both a commodity and a network.

1. Network Value to Transactions (NVT) Ratio

The NVT ratio compares Bitcoin’s market capitalization (network value) to the value of daily transactions processed on its blockchain. A lower NVT can suggest undervaluation relative to the network’s utility.

• Current Market Cap: €1,559,476,295,362.72
• Estimated Average Daily On-Chain Transaction Value: ~€11,000,000,000 (Based on general market data for Bitcoin’s on-chain settlement layer, not exchange volume, using 1 USD = 0.92 EUR).
• NVT Ratio Calculation: €1,559,476,295,362.72 / €11,000,000,000 = 141.77
• Interpretation: An NVT of 141.77 suggests Bitcoin is currently within a reasonable valuation range, indicating healthy network utility relative to its market cap. Historical lows often signal accumulation opportunities, while highs signal overheating. Our target price implies a higher NVT, predicated on future network growth and institutional utility.

2. Stock-to-Flow (S2F) Model

The S2F model relates Bitcoin’s scarcity (stock) to its new supply (flow), drawing parallels with scarce commodities like gold. Higher S2F values correlate with higher asset value.

• Current Circulating Supply (Stock): ~19,980,477 BTC
• Annual New Supply (Flow): Post-halving (April 2024), ~3.125 BTC per block * ~144 blocks/day * 365 days/year = ~164,250 BTC annually.
• Current S2F Ratio: 19,980,477 / 164,250 = 121.6.
• Interpretation: The S2F model suggests a strong positive correlation between scarcity and market value. With an S2F of 121.6, Bitcoin’s scarcity metric is exceptionally high and on par with or exceeding that of gold, supporting its long-term store of value narrative and predicting substantial price appreciation post-halving.

3. Network Effects (Metcalfe’s Law)

Bitcoin’s value is also derived from its network effects. Metcalfe’s Law posits that the value of a telecommunications network is proportional to the square of the number of connected users. Applied to Bitcoin, the growing number of unique addresses and active users contributes to the network’s overall security, liquidity, and utility. Continued growth in user adoption, driven by ease of access (ETFs) and global awareness, will further amplify these network effects, supporting our long-term price targets.

Key Risks

• Regulatory Uncertainty: Governments globally may impose stricter regulations, bans, or unfavorable tax policies on Bitcoin, negatively impacting adoption and liquidity.
• Technological Obsolescence/Bugs: While robust, unforeseen vulnerabilities in Bitcoin’s protocol or the emergence of superior blockchain technologies (e.g., quantum computing breakthroughs) could undermine its value.
• Environmental Concerns (ESG): Bitcoin’s energy consumption for Proof-of-Work mining faces increasing scrutiny. ESG pressures could lead to divestment from some institutional investors or increased regulatory burdens.
• Market Volatility & Macro Headwinds: Bitcoin remains highly volatile. Broader economic downturns, interest rate hikes, or a strong U.S. dollar could temporarily dampen investor appetite for risk assets.
• Competition: While Bitcoin’s niche as a store of value is strong, other cryptocurrencies or central bank digital currencies (CBDCs) could emerge as competitive threats or viable alternatives, albeit with different characteristics.
• Exchange Security & Custody Risks: While robust, security breaches at exchanges or issues with large custodians could lead to significant losses and erode investor confidence.

Appendix

Methodology

This report synthesizes quantitative analysis of market data, fundamental drivers (scarcity, adoption rates), and qualitative assessments of Bitcoin’s competitive landscape and macroeconomic positioning. Price targets are derived using a combination of historical cycle analysis, supply/demand projections, and comparative valuation methodologies. Estimates for network metrics (hash rate, unique addresses) are based on historical trends and projected growth rates. All financial figures are presented in EUR. USD to EUR conversion rate used for external references (e.g., $150,000 Nasdaq prediction) is approximately 1 USD = 0.92 EUR.

Disclaimer

This research report is generated by an artificial intelligence model and is intended for informational purposes only. It does not constitute financial advice, investment advice, or a recommendation to buy or sell any financial instrument. The information provided is based on publicly available data and simulated market intelligence up to the date of generation. Market data and news are sourced as indicated. Investors should conduct their own due diligence and consult with a qualified financial advisor before making any investment decisions.

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