(Bloomberg) — The market value of digital assets is poised to nearly triple to $7.5 trillion by 2025, according to one Wall Street firm that is bullish on a cryptocurrency comeback.
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This year and the next will bring a “monster of a crypto cycle,” according to Bernstein as the research firm initiated coverage on Robinhood Markets Inc. at outperform. Investors should ride the “crypto comeback arc,” said analyst Gautam Chhugani who sees the online brokerage’s crypto trading volume growing nine-fold over the next two years.
“Now is the best time to enter Robinhood, in our view, with an 18-24 month window, to ride the crypto comeback,” he wrote in a note Thursday, assigning a price target of $30 to the stock — the highest among analysts tracked by Bloomberg.
Robinhood shares rose as much as 12% to the highest intraday level since December 2021 in New York trading Thursday after reporting positive February operating data, including increases to assets under custody and surging trade volume. The stock has gained more than 40% so far this year. Wall Street is circumspect on its outlook, among analysts tracked by Bloomberg, six rate the stock a buy, 10 say hold and three recommend selling.
With crypto assets expected to grow to $7.5 trillion from $2.6 trillion today, the largest digital currency, Bitcoin, is set to become a $3 trillion asset by 2025 propelled by “the unprecendented success” of exchange-traded funds tied to the token, he added. He sees Bitcoin touching a high of $150,000 next year.
Bitcoin slid 2% to $71,606 as of 10:59 in New York, after reaching a record high above $73,000 on Wednesday.
“The crypto market is amidst unprecedented institutional adoption,” Chhugani said. “We expect continued success of the Bitcoin ETF and a likely launch of an Ethereum ETF within 12 months.”
When it comes to Robinhood, Chhugani said the company’s “full suite crypto offering within a regulated broker platform is in a sweet spot.” Traditional broker platforms, such as Charles Schwab Corp., “remain shy” on offering crypto, he added.
“In short, we are bullish crypto and we believe, Robinhood’s crypto business resurgence will restore its fortunes back again with investors.”
(Updates shares, adds chart.)
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