Bernstein says Bitcoin rebound reflects more resilient long-term holder base

ETF inflows and continued corporate buying are gradually reshaping Bitcoin’s ownership structure, Bernstein analysts say.

Bitcoin’s recent rebound reflects a strengthening base of long-term holders as ETF inflows and corporate treasury buying reshape the asset’s ownership structure, Bernstein said in a Monday research note shared with Cointelegraph.

Bernstein said Bitcoin outperformed gold and major equity indexes over the past week despite heightened conflict in the Middle East, with Bitcoin (BTC) up around 7% and Ether (ETH) up about 9% over the period.

Analysts attributed the shift partly to continued US spot Bitcoin exchange-traded fund (ETF) inflows and the steady accumulation of corporate buyers such as Strategy, which they say are gradually strengthening Bitcoin’s long-term holder base, contributing to a more stable market structure.

“Maybe it takes a physical conflict to realise Bitcoin remains the most portable (cross-border), digital and liquid asset with no counterparty risks,” Bernstein said.

Bernstein’s broader point is that ownership is changing. As roughly 60% of Bitcoin supply has been inactive for more than a year, the market is increasingly dominated by longer-term holders rather than fast-money flows. As more Bitcoin moves into ETFs, corporate treasuries and wallets that rarely transact, short-term sell pressure may matter less, potentially giving the market a more stable base during periods of stress.

CoinGecko data shows that BTC traded at about $73,208 at the time of writing, up over 8% in the last seven days amid heightened geopolitical tensions in the Middle East.

SoSoValue data shows that US spot Bitcoin ETFs had three consecutive inflow weeks totalling over $2.1 billion. Bernstein attributed the inflows to rising long-term capital allocations through wealth managers, institutional funds, including pension and sovereign funds.

Bernstein said spot BTC ETFs have nearly reversed their year-to-date (YTD) capital outflows, with net withdrawals narrowing to about $460 million, compared with roughly $92 billion in total assets under management (AUM). 

Related: Strategy records biggest STRC issuance day with estimated 1,420 BTC buy

Bernstein also pointed to Strategy’s continued Bitcoin accumulation this year.

Strategy added 66,231 BTC year-to-date for roughly $5.6 billion at an average purchase price of around $85,000, according to Bernstein. 

On March 9, Strategy announced that it had acquired 17,994 Bitcoin for $1.28 billion between March 2 and 8, pushing its total reserves above 738,000 BTC, worth about $54 billion. 

Bitcoin Treasuries data shows that ETFs and exchanges hold about 1.6 million BTC, worth over $117 billion, while public companies hold 1.15 million BTC, worth about $84 billion.

Related: Bybit doubles down on Middle East operations amid regional tensions

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Source: CoinTelegraph