Cryptocurrency stocks set to begin December with a surge as bitcoin reaches nearly 19-month peak
Crypto Miners and Bitcoin-Tracking Companies See Rise in Shares as Bitcoin Hits 19-Month High
Bitcoin Continues to Rally
Bitcoin, the world’s largest cryptocurrency, saw a 1.6% increase to $38,337, reaching a near 19-month high. Since October, Bitcoin has been on the rise due to optimism surrounding the potential approval of a spot exchange-traded fund (ETF), which is expected to bring in more capital investments in the digital asset sector.
Crypto-Focused Economist’s Perspective
According to Noelle Acheson, a crypto-focused economist, “Tailwinds have been gathering strength all year, especially in recent months, as spot ETF expectations build, the Binance uncertainty is resolved, and 2024’s accelerated money printing becomes more inevitable.” This has contributed to the momentum behind the recent bitcoin rally.
Rise in Shares of Bitcoin Miners
Shares of bitcoin miners, including Riot Platforms, Marathon Digital, and TeraWulf, saw an increase ranging from 1.7% to 4%. As bitcoin’s value climbs, the profitability of these mining companies improves. Additionally, J.P. Morgan raised its price targets on several mining companies to reflect the rally in bitcoin.
Impact on Coinbase’s Shares
Coinbase’s shares rose about 2.5% following a 62% jump in November, outperforming bitcoin’s 11% climb. This increase comes despite a reported decline in trading volume earlier in the month. CFRA Research analyst Michael Elliott believes that higher crypto prices should lead to a boost in transaction volume and revenues for Coinbase as they enter 2024.
Challenges and Regulations
However, Elliott also cautioned that Coinbase faces legal challenges and new regulations that are likely to play out over time and result in continued volatility for the stock.
ETF Approval Bets and Recent Concerns
The hope for ETF approval has helped counter concerns within the industry, following the resignation of Changpeng Zhao, the founder of the world’s largest crypto exchange, and his guilty plea to breaching U.S. anti-money laundering laws.
Gainers in the Market
In addition to the rise in shares of crypto miners and Coinbase, other gainers in the market include U.S. software developer and bitcoin investor Microstrategy, up nearly 3.5%, and ProShares Bitcoin Strategy ETF, which added 2.1%.
Overall, the improving risk appetite and ongoing optimism regarding the potential approval of a spot ETF have driven the recent rally in bitcoin, leading to positive movement in the shares of crypto miners and bitcoin-tracking companies. With expectations of increased capital investments in the digital asset sector, the industry is gearing up for further growth.
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