Bitcoin Beat The Forecast, But TD Cowen Reportedly Says The Rally May Have Further To Run

• TD Cowen's price deck assumed Bitcoin would close the third quarter at $76,235.
• However, BTC finished several thousand dollars higher, prompting the firm to review its longer-term targets, managing director Lance Vitanza said on Monday.
• Grayscale said Bitcoin's 225% three-year return falls to 95% without its five best trading days and turns into an 11% loss without its top fifteen.

Bitcoin's (BTC) stronger-than-expected performance through the end of September has prompted financial firm TD Cowen to look further out and the investment bank says the cryptocurrency may still have plenty of room to climb further.

BTC Had Already Beaten TD Cowen’s Forecast 

TD Cowen now sees the apex cryptocurrency reaching $132,750 by the end of 2027. That target represents about 54% upside for Bitcoin. This follows a previous forecast that Bitcoin would end the quarter at $76,235, with a year-end target of $97,500, but it finished several thousand dollars higher.

Lance Vitanza, Managing Director and Senior Analyst of Digital Asset Strategies at TD Cowen, said in a Bitcoin Magazine interview published Monday that the firm is now reassessing that call.

“So I'm not making any forecast change on this interview, but I will just simply point out that we are in a period now where we need to reassess our longer-term targets in the light of what we've seen, you know, through the end of the third quarter. That's just a factual statement.”

- Lance Vitanza, Managing Director and Senior Analyst of Digital Asset Strategies at TD Cowen.

While he shared a long-term outlook by 2027-end, based on what the market did through the end of September, Vitanza cautioned that the interview did not constitute a formal forecast change. He explained that TD Cowen has now put Bitcoin at $132,750 by the end of 2027, implying a gain of roughly 54% from the current price of $86,072.  Additionally, the firm's broader view has not moved. Vitanza said TD Cowen still expected Bitcoin to appreciate at a high-20% to 30% annual rate. 

Bitcoin’s price was down 0.2% in the past 24 hours. On Stocktwits, retail sentiment around BTC remained in the ‘neutral’ zone, while chatter stayed at ‘low’ levels over the past day.

Why Bitcoin Treasury Companies Could Follow

That outlook shaped where he saw the better return. Companies that keep buying Bitcoin on terms favorable to shareholders should appreciate faster than the coin itself, Vitanza said, possibly by around 50%. The test was whether they could repeat it through good and bad cycles.

Some firms walked away from the model and rebranded as artificial intelligence companies, he said, with a few selling real estate. Others decided they were "built to last." He observed whether a company could keep growing its Bitcoin per share even when its stock was not trading above the value of its holdings.

MSCI Index Removal May Be Less Significant Than Feared 

Vitanza was relaxed on reports that MSCI may drop some treasury companies from its stock indexes. Index funds held 3% or less of those companies' shares, based on what managers have told TD Cowen, he said. Finding a new home for that stake "doesn't strike me as a cataclysmic event." Index providers and credit rating agencies follow markets rather than lead them, he said. By the time they embrace the Bitcoin treasury model, institutions and retail investors will already have done so.

The Case For Staying Invested

Vitanza's argument rested on staying invested through the rough stretches. Grayscale Investments made the case for why that matters on Monday and backed it with numbers.

Bitcoin returned about 225% over the past three years, compared with 109% for the Nasdaq-100 Index, the asset manager said. Those gains were not spread evenly. “Remove BTC's 5 best trading days, and that return falls to 95%.” Take out the ten best, and it drops to 27%. Remove the top fifteen and the three-year gain becomes an 11% loss, Grayscale explained.

The Nasdaq-100's returns were far less concentrated. Removing its fifteen best days cut the cumulative gain from 109% to 21%. Fewer than 0.5% of the days in the period accounted for enough upside to more than halve Bitcoin's cumulative return when taken out. "Investors waiting for volatility to subside or the outlook to become clearer may find that much of the repricing has already occurred," wrote Zach Pandl, the firm's head of research.

Read also: Bitcoin Investors Pull $3.3B From Binance In 15 Days — But ETF Flows, Futures Positioning Flash Caution

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