Bitcoin-Adjacent Stocks Surge as BTC Reclaims $45,000
Bitcoin-adjacent stocks experienced a surge in value as the leading digital currency reclaimed $45,000. This comes after several Bitcoin spot ETF approvals last month, which caused the cryptocurrency to recover its losses. MicroStrategy (MSTR), a public software firm that holds 190,000 BTC, saw a 12% increase in share price to $569. Similarly, crypto exchange Coinbase (COIN) rose by 7.7% to $131, fully recovering from its previous dip.
Bitcoin Mining Firms Follow Suit
Bitcoin mining companies like CleanSpark (CLSK) and Marathon Digital (MARA) also witnessed significant gains. CleanSpark surged by 24% since last week, while Marathon Digital gained 16% on Thursday alone. These companies have historically traded as volatile proxies for Bitcoin and their performance demonstrates that they can keep up with BTC even in the face of competition from Bitcoin spot ETFs.
Spot ETFs: A New Option for Direct BTC Exposure
Spot ETFs, launched in January by BlackRock and Fidelity, allow investors to gain direct exposure to Bitcoin’s price. These ETFs back their shares with BTC, providing a familiar investment option similar to buying stocks using a bank or brokerage account. For firms restricted from purchasing assets outside of an equity or ETF wrapper, spot ETFs offer a viable solution. However, existing Bitcoin companies still offer unique advantages such as software development capabilities and the ability to generate cash from operations and leverage capital markets.
Vanguard’s Stance on Bitcoin Spot ETFs
Vanguard, the world’s second-largest asset manager, prohibits its clients from investing in Bitcoin spot ETFs. However, Vanguard itself is a major owner of Bitcoin miners and holds shares in MicroStrategy. This is consistent with Vanguard’s investment philosophy, which prioritizes businesses with real cash flow over commodities like Bitcoin. The late Vanguard founder, John Bogle, expressed skepticism towards Bitcoin, stating that it has no underlying rate of return unlike bonds, stocks, or gold.
Hot Take: Bitcoin-Adjacent Stocks Rally as BTC Recovers
The surge in Bitcoin-adjacent stocks following the recovery of BTC demonstrates the resilience of these companies in the face of competition from Bitcoin spot ETFs. While spot ETFs provide a new option for direct BTC exposure, existing Bitcoin companies still offer unique advantages that attract corporate investors. The performance of MicroStrategy and Coinbase, along with other mining firms, highlights the continued relevance and potential profitability of investing in the crypto market. As Bitcoin continues to regain its value and attract attention from traditional financial institutions, the future looks promising for both the leading digital currency and its associated stocks.
By
By
By
By
