Left for Dead Crypto Names Roar Higher as Bitcoin Bounces

Left for Dead Crypto Names Roar Higher as Bitcoin Bounces

With almost all publicly listed crypto equities expected to decline by 70% to 90% or more in 2022, even a small amount of life in bitcoin (BTC) this week has resulted in astronomical industry profits.

At press time, bitcoin was trading at $19,370, up almost 13% this week and at its highest level in more than two months following the collapse of cryptocurrency exchange FTX.

Coinbase (COIN), up 49% this week, is one of the major movers. To start the year, the cryptocurrency exchange has experienced many sell-side downgrades, price target reductions, and a credit rating downgrade from Moody’s. Additionally, the business this week disclosed a 20% reduction in staff. However, Cathie Wood’s ARK Investment has been bottom-fishing, buying $7.5 million in Coinbase stock this week and roughly $28.5 million for the previous month.

Bitcoin miners entered 2023 facing an existential crisis due to a combination of a low bitcoin price, rising electricity prices, frequently high debt levels, and nearly closed capital markets. Core Scientific (CORZ), one of the biggest miners by computer power, previously filed for bankruptcy, and Argo Blockchain (ARBK), which received a late-inning bailout from Michael Novogratz’s Galaxy Digital, just managed to avoid Chapter 11 proceedings (GLXY.TO).

The situation was so terrible that one of the top miners, Riot Blockchain, renounced all ties to cryptocurrency and changed its name to Riot Platforms at the beginning of the year (RIOT).

Due to these variables, even mildly positive news for bitcoin caused the shares of the industry to skyrocket. This week, Hut 8 Mining (HUT) gained 49%, Bit Digital increased by 41%, and Marathon Digital (MARA) increased by 79%. Riot’s lead this week is only 27%, maybe as payback for dropping “blockchain” from its name.

Other active cryptocurrency equities this week include MicroStrategy (MSTR), which has increased 30%, and problematic crypto bank Silvergate Capital (SI), which has increased 11%.



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