JPMorgan says Strategy’s resilience is key to bitcoin’s price direction in the near term

JPMorgan analysts suggest that the resilience of MicroStrategy (MSTR), the largest Bitcoin holder, is the primary factor influencing Bitcoin's near-term price outlook, overriding concerns about declining network hashrate or selling pressure from miners. Bitcoin's price has been pressured by a drop in hashrate/difficulty (due to China's ban and high-cost miners retreating) and developments around MicroStrategy. Although lower hashrate usually boosts miner revenue, Bitcoin is trading below the analysts' revised production cost estimate of $90,000, forcing some high-cost miners to sell. However, JPMorgan emphasizes that MicroStrategy's balance sheet strength, indicated by its enterprise-value-to-bitcoin-holdings ratio staying above 1.0 and its $1.44 billion USD reserve, signals it is unlikely to sell BTC to cover obligations, which would reassure markets. Furthermore, the risk associated with MSCI potentially excluding MicroStrategy from indices appears largely priced in; a negative decision is expected to have limited downside, while a positive decision could lead to a strong rebound for both MSTR and Bitcoin. Long-term, JPMorgan maintains a theoretical Bitcoin price target near $170,000 based on gold comparisons, assuming market stabilization.

(Source：The Block)