• Bitcoin has appreciated by over 80% since the start of 2023.
• Publicly traded Bitcoin miners have seen share prices triple this year.
• Mining stocks are directly linked to Bitcoin’s price, but can also experience greater downside volatility.
Bitcoin Performance in 2021
Bitcoin (BTC) has had an impressive run since the start of 2021, appreciating over 80%. This increase in value has been mirrored by certain publicly traded companies that are related to or benefit from the asset’s success.
Shares for multiple publicly traded Bitcoin miners surged on Friday. Examples include CleanSpark (CLSK; 11.32%), Riot Platforms (RIOT; 14.33%), and Hut 8 (HUT; 6.14%). All three miners have seen their share prices at least triple since January 1st, with rival mining firm Iris Energy even seeing a jump of 48%. These firms are directly connected to Bitcoin’s price, as they receive newly minted coins every ten minutes from the network itself. Many such miners have made major investments this year in preparation for the “halving” event which is expected to catalyze a bull market for BTC and its related assets.
Despite the potential upside offered by mining stocks, they can also encounter even greater downside volatility than BTC itself. Core Scientific (CORZQ), for example, saw its share price collapse over 80% in just one day earlier this year when fears about new regulations surfaced in China – a key market for many mining companies due to its low electricity costs and proximity to technology suppliers.
Other Related Companies
Several other companies that are related to or benefit from Bitcoin’s success have also seen their stock prices climb higher this year – although not quite as much as the mining stocks mentioned above. Financial services company Square Inc., for example, is up 28%, while cryptocurrency exchange Coinbase Global Inc is up more than 50%. Overstock – which started accepting BTC payments years ago – has jumped nearly 200%, with shares trading near all-time highs thanks to its blockchain initiatives and crypto-focused subsidiaries like tZero and Medici Ventures.