Bernstein Research believes there are good long-term investment opportunities among Bitcoin mining stocks.
AllianceBernstein's investment research arm, Bernstein Research, points out that the current drop in the price of Bitcoin mining stocks represents a good entry opportunity for those investors looking to gain exposure to the crypto market.
Despite a more than 9% drop in the price of Bitcoin over the past week, which has affected the price of cryptocurrency mining stocks, the investment firm’s strategists believe that now is a good time to enter the crypto market, and advise long-term investors to “buy the dip” in these stocks.
Bitcoin ETF is discounted
The frenzy over the approval of Bitcoin ETFs in the United States seems to have already been priced into the market, with Bitcoin trading at around $42.400 at the time of writing.
The market-leading cryptocurrency has seen its price fall by 9,77% this week, after trading above the $48k level, following the approval of spot ETFs on January 10.
Source: CoinMarketCap
In addition to the drop in the price of the leading cryptocurrency, the investment firm’s analysts also believe that the approval of Bitcoin-based exchange-traded funds has diminished the need for investors to use mining stocks as a “proxy” or alternative, which has also affected the price of these stocks in the market today.
According to Coinspeak isBernstein Research highlighted that there is “a lower appetite from investors to use them as a substitute,” which is affecting the performance of Bitcoin mining stocks. In addition to this, it indicated that a weaker Bitcoin price in the market is contributing to further underperformance for these stocks.
However, for the firm, this poor performance offers a good opportunity for those looking to gain exposure to Bitcoin, so it suggests accumulating these shares before the next inflection in the price of the cryptocurrency.
Analysts anticipate that the fourth Bitcoin halving will trigger a new bull run that will push the BTC price to new highs.
Bernstein's shift to Bitcoin
This is not the first time that the respected Wall Street investment research firm has advised allocating a portion of investment portfolios to Bitcoin.
In November 2020, Bernstein Research suggested that investors could allocate up to 10% of their investment portfolios to cryptocurrency, which is considered a potential investment asset and a safe long-term store of value. At the time, the firm highlighted that BTC had an important role in the asset allocation sector. Since the publication of its report, Bitcoin's price has appreciated by 120% to date.
Continue reading: ProShares Introduces 5 New Leveraged and Inverse Bitcoin ETFs
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