Surge In Crypto Stocks: Bitcoin Crosses $42000 Mark First Time Since April 2022

7 months ago
1 min read

Cryptocurrency-related stocks listed in the United States (US) surged on Monday, looking to extend their strong November gains, as bitcoin topped $42,000 to hit a fresh high for the year.

Shares of companies whose fortunes are tied to the cryptocurrency have rallied in recent weeks, spurred by optimism about potential interest rate cuts in the US as well as traders betting on the imminent approval of US stock market-traded bitcoin funds.

In its highest since April 2022, Bitcoin climbed 4.1 per cent to $41,649- It had hit $42,162 earlier in the session. “The impact of an (ETF) approval is going to be big in terms of investment appetite because it’s going to be more easily regulated, more attractive and easier to invest.

“What we have right now is a risk rally, and bitcoin is also benefiting big time from falling yields. There is also this positive bullish sentiment into next year because it is going to be the year of halving,” said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.

Halving is a process designed to slow the release of bitcoin, and bitcoin prices have typically rallied following halvings.

Coinbase (COIN.O) jumped 7.5 per cent. The stock rose nearly 62 per cent in November, even as the crypto exchange reported a decline in third-quarter trading volumes.

Bitcoin investor Microstrategy (MSTR.O), which bought bitcoins worth $593 million last month, gained 8.2 per cent.

Bitcoin miners such as Riot Platforms (RIOT.O), Marathon Digital (MARA.O) and CleanSpark (CLSK.O) jumped between 10.3 per and 18.8 per cent respectively, adding to their double-digit gains in November.

The ProShares Bitcoin Strategy ETF, which tracks bitcoin futures, rose 7.7 per cent and looked set to touch an over one-year high, while the ProShares Short Bitcoin Strategy ETF which allows traders to bet on a fall in bitcoin futures fell 7.7 per cent.

Investor sentiment toward cryptocurrencies and related assets had been lukewarm earlier this year after a string of high-profile collapses in 2022 led to outflows of more than a trillion dollars from the sector.

However, the recent rally has sent bitcoin up more than 150% so far in 2023, on course for its best annual performance since 2020.


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