Monday’s surge in the price of Bitcoin (BTC) has had a positive effect on Bitcoin-related stocks, with companies like Coinbase and MicroStrategy reaching new multiweek highs. Interestingly, Bitcoin mining stocks also experienced significant gains during this price rally.
Riot Blockchain, a United States-listed company, saw its stock price surge by 11.69%, while Marathon Digital Holdings recorded a 14.6% increase. The upcoming halving event, which will reduce the Bitcoin mining reward from 6.25 BTC to 3.125 BTC per block, likely contributed to the increase in stock prices.
Bitcoin mining stocks not only outperformed Bitcoin in the recent price rally, but they also outperformed in terms of year-to-date (YTD) gains. Cipher Mining, for example, has seen a remarkable YTD increase of 356%, compared to Bitcoin’s 86% increase. Similarly, Riot Platforms has registered a 163.10% YTD increase in stock price. Northern Data, a general processing unit miner based in Frankfurt, Germany, has experienced an impressive 291.40% growth. Other Bitcoin mining companies like Hut 8 Mining, Iris Energy, Bitfarms, Marathon Digital, and Hive Technologies have all seen over 100% growth in 2023.
Apart from Bitcoin mining companies, other Bitcoin-centric public firms, such as Coinbase and MicroStrategy, also reached multiweek highs. At the time of writing, Coinbase’s stock was up by 3.42%, while MicroStrategy, which holds the most Bitcoin among public companies, recorded a 9% surge on the daily charts.
MicroStrategy’s Bitcoin holdings have now turned profitable for the third time in 2023. After being in the red by as much as -50% during the bear market, the company’s investment has yielded unrealized gains of nearly $1 billion. MicroStrategy currently holds 158,245 BTC, which it acquired for $4.68 billion at an average price of $29,582. The current value of their Bitcoin holdings is $5.5 billion.
The surge in the price of Bitcoin on October 23 pushed it above the $35,000 mark, reaching a one-year high. However, the price retraced below $33,000 shortly after. On October 24, the BTC price experienced another surge of 5%, trading above $34,500 at the time of writing.
Overall, the recent surge in the price of Bitcoin has had a cascading effect on related stocks, boosting the performance of publicly traded Bitcoin mining companies like Riot Blockchain and Marathon Digital. As Bitcoin continues to gain mainstream recognition and acceptance, more and more companies are likely to benefit from its success in various ways, whether through direct ownership or by providing services related to cryptocurrency.