Summary

Markus Thielen highlighted that Bitcoin ETF flows have shifted from hedge fund arbitrage to long-term investor adoption, stabilising prices. However, slowing inflows, higher funding rates, and the Fed’s hawkish stance have pressured Bitcoin, with a possible correction to $73,000 anticipated before resuming upward momentum. Thielen noted that MicroStrategy stock remains overvalued, trading around $300 despite a fair value closer to $150 based on Bitcoin holdings. Convertible debt issuance has slowed, reducing MicroStrategy’s ability to acquire more Bitcoin and limiting its influence on market price surges. Thielen also discussed infrastructure plays like mining companies and exchanges, noting that while smaller exchanges struggle with profitability, major players like Binance generate substantial profits. He was cautious on investing in exchanges or miners long-term but acknowledged periodic opportunities during Bitcoin price surges. The conversation shifted to the macro backdrop, emphasising that Bitcoin's price largely responds to U.S. monetary policy rather than political headlines. Despite anticipation surrounding Trump’s pro-crypto stance, Thielen believes meaningful market upside would require concrete policy changes, such as the proposed U.S. Bitcoin strategic reserve or sovereign wealth fund. Thielen also outlined key Bitcoin valuation metrics, such as the market value-to-realized value (MVRV) ratio and power law models, indicating potential upside to $190,000-$260,000 in the next cycle. However, near-term headwinds like low liquidity and macroeconomic uncertainty could trigger a correction before the next leg higher. Thielen remains bullish on long-term adoption but expects volatility tied to monetary policy shifts, particularly as U.S. dollar liquidity tightens.

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