Coinbase and MicroStrategy, two prominent players in the crypto industry, are witnessing a remarkable surge in their stock prices as Bitcoin reaches an impressive milestone of $35,000 for the first time since 2022.
Bitcoin’s recent surge above $35,000 is not only impacting the cryptocurrency market but also driving up the shares of several crypto-related companies. Investor optimism is on the rise, particularly with the potential approval of a spot Bitcoin ETF.
On Tuesday morning, Bitcoin mining stocks saw significant gains, with Marathon Digital Holdings and Riot Platforms up 18% and 15% respectively. Coinbase, the largest US-based crypto exchange, also saw its shares rise by 15% to around $89. MicroStrategy, a well-known Bitcoin HODLer, experienced a 13% increase, reaching $427 after the market opened.
In contrast, two of the three major indices, including the Dow Jones Industrial Average and the S&P 500, closed down on Monday. However, the tech-heavy Nasdaq managed to rise by 0.3%.
The recent surge in crypto-related stocks follows a downturn in 2022 that pushed some of these companies to the brink. Coinbase, for example, saw its stock drop to as low as $35 after its initial public debut in 2021.
Bitcoin’s rally above $35,000 is significant as it marks the first time since 2022 that the cryptocurrency has reached this level. Although it has slightly pulled back to around $34,400, Bitcoin’s increase is noteworthy, especially since it broke through the psychologically important level of $30,000 on Monday. According to CoinGecko, Bitcoin now accounts for over half of the overall crypto market, thanks to a surge in inflows in recent days.
In other news, Grayscale recently won a victory over the SEC in a lawsuit regarding the agency’s denial of the asset manager’s bid to create a spot Bitcoin ETF in 2022. While the court of appeals ruled in favor of Grayscale, the SEC has yet to officially approve the application.
Notably, other traditional finance heavyweights like BlackRock and Fidelity have also filed applications to create their own spot Bitcoin ETFs. These ETFs would provide investors with more direct exposure to Bitcoin, the world’s largest cryptocurrency. BlackRock has taken a step forward in preparing for its Bitcoin ETF launch by registering a ticker—IBTC—for its iShares Bitcoin Trust with the Depository Trust & Clearing Corporation. An amendment to BlackRock’s ETF application also revealed that a seed investor could fund the investment vehicle this month, although it’s not necessarily indicative of when the spot Bitcoin ETF would begin trading.
Overall, the recent rally in Bitcoin and the potential approval of a spot Bitcoin ETF have sparked optimism among investors and led to significant gains in crypto-related stocks. As the cryptocurrency market continues to evolve, it will be interesting to see how this trend develops and if more traditional financial institutions enter the space.