BusinessCryptocurrencyMoney

Why Crypto Miner Stocks Were on Fire Today

[ad_1]

While there is no death-and-taxes certainty in stock investing, it’s a safe bet that when cryptocurrencies are doing well, shares of the companies that mine them will also rise. The action in crypto mining stocks on Monday reinforced that hypothesis; the bulk of them saw increases, some at double-digit percentages.

Riot Platforms (RIOT 9.02%), TerraWulf (WULF 9.09%), and Cleanspark (CLSK 8.55%) all landed just shy of that benchmark, closing the day around 9% higher. Marathon Digital Holdings (MARA 12.76%) and Hut 8 Mining (HUT 13.44%) managed to cross the line with gains around the 13% mark, as did Bitfarms(BITF 10.78%) almost 11% advance. 

The leading crypto leads the way

Those increases mirrored the popularity of bedrock cryptocurrencies on the day, most notably that of Bitcoin (BTC 9.25%). When crypto bulls run wild, very often it’s the pioneering coin that leads the charge. That digital currency’s price rose as much as 9% over the 24 hours up to late afternoon Monday; not surprisingly, many other cryptos were also well in positive territory.

Bitcoin was flying high because the crypto might soon and suddenly attract even more interest from investors. 

That’s because hopes for the introduction of spot Bitcoin exchange-traded funds (ETFs) kept rising over the weekend, capped by Monday’s news that Grayscale Investments notched a victory in its ETF ambitions. The company’s application to convert its Grayscale Bitcoin Trust into a Bitcoin ETF was originally rejected by the Securities and Exchange Commission (SEC).

Bitcoin bulls can be a hardy and persistent bunch, though, so Grayscale disputed the ruling in court. On Monday, an appeals court hearing the case issued a final ruling that basically quashes the SEC’s rejection.

While the regulator could still put the kibosh on the Grayscale conversion on other grounds, investors took this as a clear sign that — sooner or later — spot Bitcoin ETFs will win approval and open for business.

ETFs are a boon for underlying markets

ETFs have been among the many types of investments supporting the stock market, as they allow investors to invest indirectly in equities. It’s likely that the dynamic will be similar with spot Bitcoin (and other crypto) ETFs. We can imagine the effect on coin and token prices once specialty ETFs become a presence.

Investors were imagining that in droves on Monday, hence the rise of Bitcoin and a large selection of altcoins on the day — and, by extension, cryptocurrency miners.

Could this rally continue? I would imagine so, as even stripping out the spot crypto ETF hopes reveals a favorable landscape for digital currency.

Investors are confident now and less worried than they have been recently about the proximate future of both the U.S. and the global economy. When they’re in that state, they tend to be more attracted to speculative investments like cryptocurrencies and crypto-related stocks. So, I’d expect more gains for such assets in the coming days. 

[ad_2]

Related Articles

Leave a Reply

Back to top button