May 19, 2024

News and Political Commentary

Why Bitcoin Mining Stocks Tumbled Sharply on Thursday

2 min read

There was a lot of action in cryptocurrency-related stocks on Thursday. Unfortunately for shareholders of crypto-mining companies, the action in that segment consisted of widespread sell-offs.

Several really took it on the chin that day. Marathon Digital Holdings (NASDAQ: MARA), for instance, saw its share price close nearly 13% lower. Worse for wear was peer Riot Platforms (NASDAQ: RIOT), with an almost 16% decline. Landing between the two was the much smaller Bitfarms (NASDAQ: BITF); its stock endured a more than 13% decrease.

The new crypto securities were all the rage

The main culprit was the market’s new spot Bitcoin (CRYPTO: BTC) exchange-traded funds (ETFs), which started trading on Thursday. Investors piled into these new instruments; all told, $4.6 billion worth of them changed hands as of that afternoon. We can reasonably conclude that at least some of these trading parties pulled money out of Bitcoin mining stocks in a reallocation move.

This wasn’t only about novelty. Spot Bitcoin ETFs already have quite a presence on the scene, as all 11 of them under review by the Securities and Exchange Commission (SEC) were approved for trading yesterday. So not only are they new, different, and attractive, they also give investors plenty of choice.

Crypto bulls have had a sharp focus on spot crypto ETFs since they were barely a gleam in the eyes of the companies that proposed them. Speculation was rife that at least a few would be approved early this year. Many investors and observers were surprised that all of the applicants had their new securities green-lighted; the general expectation was that at least several wouldn’t win the regulator’s nods.

Another factor in the move away from mining stocks on Thursday is that they are all heavily (or entirely) concentrated on creating new Bitcoin. So far, only spot Bitcoin ETFs have hit the market; no firm has yet created and won approval for spot ETFs covering one or more altcoins. So the Bitcoin world will likely be focused…



2024-01-11 18:55:00

All news and articles are copyrighted to the respective authors and/or News Broadcasters. VIXC.Com is an independent Online News Aggregator


Read more from original source here…

Leave a Reply

Copyright © All rights reserved. | Newsphere by AF themes.