Strategy’s $2.5M Bitcoin sale precedes Ethereum outperformance

Standard Chartered research head Geoff Kendrick wrote that Strategy (MSTR) disclosed a $2.5 million sale of Bitcoin on Monday. The disclosure came as Bitcoin slid about 5.8% to roughly $67,300 and Ethereum registered one of its largest daily gains against Bitcoin.

Kendrick’s note examined the ETH/BTC ratio, which peaked near 0.042 in August when Ether approached $5,000 and has trended lower since 2022. He recorded that since the start of 2024 Ethereum outperformed Bitcoin on days when Bitcoin fell only 23 times.

Under a static Bitcoin-price assumption, Kendrick projected Bitcoin around $67,300 by year-end and Ether rising about 41% to roughly $2,700 from current levels near $1,900. Standard Chartered has a separate year-end target of $4,000 for Ether and longer-term forecasts of $40,000 for Ether and $500,000 for Bitcoin by the end of the decade.

The note highlighted a structural difference between holders of the two assets: Ether can be staked to earn rewards for validating transactions, generating a potential income stream that can reduce the need to sell. The analysis also pointed to growing institutional activity in stablecoins and tokenization on the Ethereum network, and cited recognition from large asset managers including BlackRock.

Shares of Strategy dropped more than 9% on Tuesday to close at $136.08. The stock declined nearly 15% over five trading days and more than 23% on the month, alongside Bitcoin’s pullback from its all-time highs.

Kendrick described the $2.5 million sale as a small trade that highlighted differences in demand dynamics between Ethereum and Bitcoin and noted it coincided with favorable price conditions for Ethereum on the day in question.