MicroStrategy Share Price May Rise On Bitcoin ETF Adoption, Ethereum ETF Rejection, TD Cowen Says

The share price of Michael Saylor’s MicroStrategy may rise ”meaningfully higher” by the end of this year due to greater institutional adoption of Bitcoin ETFs and the likely rejection of Ethereum ETFs by regulators, TD Cowens said.

One catalyst for the Bitcoin price, and thus MicroStrategy shares, could come on May 15, the deadline for institutional investment managers to file form 13-F with the Securities and Exchange Commission (SEC), analyst Lance Vitanza said in a May 6 note.

If the filings show more institutions have purchased Bitcoin ETFs (exchange-traded funds), it will signal an increase in institutional acceptance of BTC, Vitanza said. 

“#Bitcoin is the best. There is no second best.”–@saylor#BitcoinforCorporations

— MicroStrategy (@MicroStrategy) May 2, 2024

A second potential trigger is the likely rejection by the SEC of Ethereum ETFs about a week later, which could also send investors flocking to Bitcoin, he said.

Given MicroStrategy’s aggressive accumulation drive of BTC, both developments could have a positive impact on the leading crypto’s price, and MicroStrategy’s share price, Vitanza said.

After attending MicroStrategy’s World 2024 user forum in Las Vegas last week, Vitanza also said that customers had a lot of positive feedback regarding the company’s original software business.

“This is causing us to rethink the potential upside around the operating business,” the analyst wrote.

MicroStrategy Reports $53.1 Million Loss For Q1 2024

Vitanza’s positive outlook for MSTR comes after MicroStrategy reported a net operating loss of $53.1 million for the first quarter of this year. The reason for the loss was the company’s decision to not adopt a new digital asset fair value accounting standard. 

Had the company utilized this new standard, MicroStrategy would have posted a sizable profit from BTC’s strong price appreciation.

MSTR is up 89% year-to-date, but could still climb higher, Vitanza believes.

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