Fever over BlackRock's bitcoin fund faces chill of rate hikes andAs Bitcoin surges with remarkable momentum, several Bitcoin-linked stocks are seizing the opportunity to record staggering highs, proving once more that the digital currency’s influence on the broader market is undeniable.
A Golden Era for Mining Stocks
The price hike of Bitcoin witnessed on Monday had a cascading effect on Bitcoin-connected stocks.
Companies like Coinbase and MicroStrategy proudly declared multiweek highs, further validating the notion that when Bitcoin shines, its glimmer touches others in its realm.
In particular, Bitcoin mining companies seem to be reaping the benefits, with their stocks not only echoing but outpacing Bitcoin’s gains.
A closer look reveals that Riot Blockchain, a US-based entity, enjoyed an 11.69% upswing while Marathon Digital Holdings rode a 14.6% wave. And it’s not just the mere price propulsion of Bitcoin driving these numbers.
Analysts are eyeing the imminent halving event, set to slice the Bitcoin mining reward from 6.25 BTC to a mere 3.125 BTC per block, as a significant force behind this push.
The plot thickens when examining the year-to-date (YTD) gains. Cipher Mining took the spotlight with a staggering 356% YTD leap, making Bitcoin’s 86% YTD look almost modest.
Meanwhile, Riot Platforms reported a robust 163.10% YTD growth, and Northern Data, the Frankfurt-based giant, noted an increase of 291.40%.
With these numbers in mind, it’s no surprise to see that companies like Hut 8 Mining, Iris Energy, Bitfarms, Marathon Digital, and Hive Technologies have all posted YTD growth surpassing 100% in 2023.
The Corporate Bitcoin Dance
It’s not just the miners basking in Bitcoin’s glory. Renowned Bitcoin-focused firms like Coinbase and MicroStrategy have joined the dance.
The former’s stock ticked upwards by 3.42%, and the latter, which boasts the title of the public firm with the most significant Bitcoin holdings, saw its numbers surge by 9% on daily charts.
Speaking of MicroStrategy, it’s worth a momentary detour to delve into their Bitcoin relationship. This year, for the third time, the company’s Bitcoin assets have flourished.
After battling the red zone with a bleak -50% during the bearish phase, their turnaround story has been noteworthy. MicroStrategy possesses a hefty 158,245 BTC, acquired at an average price of $29,582.
With the current valuation, their treasure chest holds assets worth $5.5 billion, hinting at nearly $1 billion in potential gains.
To top it all, Bitcoin’s price movements have been nothing short of a roller coaster. After soaring past the $35,000 milestone on Oct. 23, it didn’t rest on its laurels.
Although it experienced a slight dip below $33,000, Bitcoin’s resilience was apparent when its price jumped by another 5% the following day, hovering above the $34,500 mark.
As we navigate these market surges, it’s evident that Bitcoin’s tidal waves have the power to carry numerous vessels. The critical question remains – how long will this tide last, and who truly stands to benefit in the long run? It’s a game of numbers, strategy, and perhaps, a bit of luck. Time will tell.
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