Despite being at all-time high prices, it is still a very opportune time to buy bitcoin (BTC),” warns a new analysis by the investor author of the newsletter “The Value Edge.”

Many skeptics will continue to be hesitant to buy at all-time highs, thinking that such a volatile asset may be on the verge of a correction, he says. However, he believes there are factors that will contribute to bitcoin continuing to record parabolic returns. Therefore, he considers any price to be an investment opportunity.

“In fact, I think the next time we see a major correction in Bitcoin, it might be a ‘pullback’ to a much higher price than the current one,” he says. Since its inception, BTC has gone through intense bull and bear cycles in which it always records higher highs and higher lows, something that the current outlook suggests will happen again.

For the author, “we are at the beginning of another period of intense bullish performance of bitcoin prices due to increased institutional participation amid the ever-slowing supply that is built into the core of the Bitcoin network.”

To put this into perspective, consider that Michael Saylor and his company MicroStrategy made headlines by announcing that they plan to buy $42 billion worth of Bitcoin over the next three years. Because this company, famous for buying BTC on a recurring basis and holding the most, will continue to contribute to the price increase, not only by not selling its holdings, but by accumulating more.

As seen below, MicroStrategy owns 279,420 BTC, currently valued at $25.5 billion, twice its acquisition price. The green circles show the times it has made purchases, while the green line its average acquisition cost and the blue line the price of bitcoin.

MicroStrategy's bitcoin holdings. Source: SaylorTracker.

In addition, Block buys bitcoin monthly using 10% of its gross profit from the products it offers in the currency. In addition, bitcoin  ETFs provided by large institutions such as BlackRock and Fidelity project greater adoption of bitcoin.

Meanwhile, tech giant Microsoft will hold a shareholder meeting in December to decide whether to buy bitcoin. “While management recommended shareholders vote against, it is indicative of a broader acceptance and conversation around using bitcoin as a reserve asset,” says The Value Edge.

It should also be noted that Microsoft shareholders such as Vanguard, BlackRock and State Street will be eligible to vote on the proposal. “All of these now have a vested interest in increasing the rate of adoption of bitcoin,” the newsletter clarifies, so they could push for their purchase.

The rise in institutional ownership of bitcoin comes at a time when some nations have begun to accept bitcoin as legal tender, he said. This comes as the number of participants in the cryptocurrency sphere is growing.

In addition, Donald Trump, the US president-elect, plans to have a strategic reserve of BTC, in addition to boosting the cryptocurrency industry. This “has the potential to trigger another parabolic period for the price of bitcoin,” the financial newsletter notes.

If the US buys bitcoin, other governments will follow

Currently, the United States is the government that holds the most BTC, a holding that has come from seizures. This is something that Trump wants to keep as a strategic treasury reserve. In addition, there is a bill underway in the country to start a bitcoin purchase program.

Governments with the largest amount of bitcoin and its current value. Source: Bitcoin Treasuries.

From a nation-state perspective, bitcoin ownership is a matter of game theory, The Value Edge explains. It’s risky to be a first mover, but it’s equally risky to be a laggard, it warns. So with both retail and institutional adoption growing, expect governments to get in on the act as well.

“If the United States starts accumulating bitcoin, virtually every other nation will have an incentive to accumulate bitcoin,” The Value Edge exclaims. Moreover, some analysts believe that this could help the economic powerhouse pay off its exploding national debt.

“The confluence of factors contributing to bitcoin demand growth is powerful. Taken together with the 2024 halving, which cut supply growth in half, and the optimism surrounding a pro-crypto Trump administration, this is nothing short of a golden opportunity to accumulate bitcoin.”

The Value Edge, investment research newsletter.

So, beyond any criticism there may be, he sums up that “what matters is the increasing number of hodlers, a growing institutional adoption and a growing adoption by nation-states,” he sums up.

The term holders refers to enthusiastic bitcoin investors who hold the currency for the long term.

Bitcoin shows exploding demand and slowing supply

The newsletter further elaborates that the most widely understood benefit of bitcoin over fiat money is its fixed supply. Unlike national currencies like the US dollar (USD) or any other, bitcoin cannot be issued unlimitedly at the discretion of a government.

Bitcoin issuance, which is produced by decentralized mining, is automatically halved every four years through an event called halving. It has a finite supply of 21 million BTC units, so once they are all mined (expected for 2140) no more can be issued.

This feature of Bitcoin contributes to its price rise, as it implies a limited supply, as well as a factor that attracts new demand. This is why it is called an anti-inflationary asset, the opposite of fiat money that depreciates and generates inflation due to its unlimited issuance.

“The slowing growth in Bitcoin supply and its increasing institutional adoption, especially after Trump’s victory, indicate strong fundamentals and a bullish outlook for continued price growth,” The Value Edge concludes.

In all economics courses, students are taught that the balance between supply and demand dictates price behavior in free and open markets. And, as shown below, the price of bitcoin is a clear example of this, the newsletter explains.

“Regardless of your opinion on blockchain technology or cryptocurrencies, it is dangerous to bet against basic economics,” The Value Edge mentions. Because the reality of bitcoin currently features exploding demand and slowing supply, it details.

Buying Bitcoin Using DCA Can Be a Winning Strategy

“With the confluence of factors contributing to strong demand growth, I expect another parabolic period for the Bitcoin price in 2025,” he clarifies. And he foresees the next correction to be to a higher low, above the current price or in this zone.

So, in the face of these bullish expectations, it is advisable to carry out DCA. This operation consists of recurring purchases of an asset with upward potential to average the acquisition cost.

“DCA’s approach is useful for both retail and institutional investors,” he exclaims. MicroStrategy, the largest investor in bitcoin after its creator Satoshi Nakamoto, currently has unrealized gains of $15 billion, despite having made some of its purchases at all-time highs in the last bull cycle.

“A DCA strategy is key, as exemplified by Michael Saylor’s MicroStrategy, meaning bitcoin is a buying opportunity at any price,” the newsletter concludes. In other words, it concludes: “bitcoin remains a good buy despite having hit all-time highs.”