The Price of Bitcoin Boosts Coinbase and MicroStrategy Stocks
This morning, the stocks of Coinbase and MicroStrategy experienced significant increases in the US premarket. This surge was fueled by the rally in Bitcoin, which surpassed the critical level of $45,000 for the first time since April 2022.
The main reason behind this surge is the anticipation of a spot Bitcoin ETF approval in the USA. If approved, this ETF is expected to bring more trading volumes and liquidity into the crypto sector. Coinbase stands to benefit as it would serve as a custodian for funds from BlackRock, Franklin Templeton, and Grayscale. Meanwhile, MicroStrategy continues to increase its holdings in Bitcoin, strengthening the correlation between its stock price and the price of the cryptocurrency.
The Increase in Coinbase Stock
Coinbase’s stock (COIN) saw a 4% increase, with an expected opening at $180.5. Compared to last year, the stock is now worth about five times more, thanks to a bullish 2023 where prices increased by over 150%. Although it is still below its all-time high of $343 in November 2021, if the crypto market enters a new bull market, Coinbase could potentially reach a new peak.
The Rise of MicroStrategy Stock
MicroStrategy’s stock also experienced a 7.5% increase during premarket trading on Nasdaq, reaching an opening price of $678. In 2023 alone, the company’s stock prices increased by 335%, with a doubling in prices during the last quarter alongside Bitcoin’s 60% increase. With only an 8% discount compared to its peak in 2021 at $750, a new all-time high appears likely for MicroStrategy in the coming months.
The Impact of a Bitcoin ETF Approval
The surge in Coinbase and MicroStrategy stocks is a reflection of the price action of Bitcoin, which is discounting the upcoming approvals of the first spot ETF in the USA. Rumors suggest that the SEC could announce the approval as early as Friday, leading to increased liquidity and trading volumes in the crypto markets. If approved, Coinbase would benefit as it has been selected as a custodian by investment funds like BlackRock, Franklin Templeton, and Grayscale. MicroStrategy’s stock is directly influenced by Bitcoin’s performance since the company holds a significant amount of digital gold.
Data About Coinbase and MicroStrategy
Looking beyond stock prices, some key data about Coinbase and MicroStrategy sheds light on their growth over the past year. Coinbase has seen a significant number of active users trading cryptocurrencies, with approximately 22.4 million users in the first 9 months of 2023. Out of the $76 billion traded volume in Q3 2023, over 85% comes from retail customers. BTC and ETH are the most traded assets on Coinbase, accounting for around 57% of the total trading volume.
MicroStrategy is becoming a prominent advocate for Bitcoin, with increasing exposure to the cryptocurrency both financially and through public image. The company holds a substantial amount of BTC and actively communicates its position on Twitter. It positions itself as the largest public company in terms of BTC holdings, surpassing competitors like Square, Tesla, Coinbase, Marathon, and Nexon.
Hot Take: Coinbase and MicroStrategy Stocks Surge Amid Bitcoin Rally
The recent surge in Coinbase and MicroStrategy stocks can be attributed to the rise in Bitcoin’s price and the anticipation of a spot Bitcoin ETF approval. If approved, these companies stand to benefit from increased trading volumes and liquidity in the crypto sector. This surge reflects the growing interest of institutional investors in cryptocurrencies and highlights the strong correlation between Bitcoin’s price and the stock prices of Coinbase and MicroStrategy. As the crypto market continues to evolve, these companies are well-positioned to capitalize on the expanding adoption of digital assets.
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