Bernstein says 'Goldilocks scenario' is emerging for bitcoin miners amid 'Trump factor'

Analysts at research and brokerage firm Bernstein said a “Goldilocks scenario” is emerging for bitcoin miners amid the “Trump factor” following a failed assassination attempt on the former U.S. President at a rally in Pennsylvania on Saturday.

“The Goldilocks scenario for bitcoin mining is emerging: greater chances of pro-bitcoin political change, U.S emerging the dominant hub for bitcoin mining and latest generation mining chips, miners being valued for their lead in power interconnect, and miners emerging as strong partners for AI data centers,” Gautam Chhugani and Mahika Sapra wrote in a note to clients on Monday.

The price of bitcoin initially fell as the would-be assassin’s bullet pierced Trump’s right ear, and the presumptive Republican presidential nominee dropped to the ground. However, it rebounded strongly as the former President got to his feet, raising his fist in the air and shouting “fight.” Bitcoin BTC +4.42% subsequently jumped around 6% from $59,250 to $63,000 in what some commentators have referred to as the “Trump pump.”

Decentralized prediction market platform Polymarket’s odds on the winner of the U.S. presidential election now show a 71% chance for Trump — up from about 60% around the time of the incident — with President Joe Biden’s chances of victory at just 18%.

The crypto market interprets a Trump win as "more positive" for crypto, given the Biden administration’s regulatory crackdown on the industry compared to pro-bitcoin statements by Trump in recent months, according to the analysts, including advocating for self-custody and bitcoin mining.

“Bitcoin’s price is positively correlated with the probability of a Trump Presidency and will remain sensitive to election updates,” the analysts said.

Public bitcoin miners are expected to open positively

After the weekend’s shocking events, Chhugani and Sapra expect public miners' stocks to follow bitcoin and open positively on Monday, following weeks of sideways price action post- halving .

Additional tailwinds for miners include an extensive pipeline of access to power, AI diversification opportunities and greater mining technology in the U.S., with Jack Dorsey's Block recently agreeing to supply Core Scientific with its new 3nm mining chip, the analysts said.

U.S bitcoin miners have ready "power interconnect"of ~6GW with an active pipeline of 12GW by 2027E. Image: Bernstein.

Last week, the Bernstein analysts initiated coverage on two additional miners with a hybrid bitcoin mining and AI data center strategy: Core Scientific and IREN.

Chhugani and Sapra also reiterated their $200,000 bitcoin price target for the end of 2025, $500,000 by the end of 2029 and $1 million by the end of 2033.

Gautam Chhugani maintains long positions in various cryptocurrencies.