Bitcooin mining stocks have picked up speed again just before the halving event, after experiencing setbacks for several weeks. On the other hand, tech stocks have seen limited progress in the market, with tensions in the Middle East causing unease and leading to a connection between stock and crypto asset prices.
Today marks the Bitcoin halving, which means miner rewards will be reduced by half from 6.25 Bitcoins to 3.125 Bitcoins per block. This significant event has sparked various market reactions and fluctuations over the past two months. Currently, the Bitcoin price hovers at $63,501 as the cryptocurrency attempts to resist the wave of liquidations that emerged this week.
Miners have been a significant topic in discussions about Bitcoin halving due to the impending reduction in their rewards, while advancements in capacity and hashrate continue at mining operations. However, many believe that this event is a positive sign for Bitcoin and could be the catalyst for the next bull market.
Bitcoin Mining Stocks Rally
Publicly traded Bitcoin mining companies have seen their stock prices surge in tandem with the cryptocurrency market. For instance, Hut 8 Mining Corporation (HUT) has gained 2.31% over the past 24 hours. The company’s stocks have experienced additional growth this week as the highly anticipated Bitcoin halving event approaches.
Marathon Digital’s stock price jumped by 9.78% today, reversing the losses from the past week and putting an end to the outflows from investors who were uncertain about mining companies. At the same time, Riot Platforms experienced a more significant increase of 10.13%.
In the past month, RIOT experienced a significant increase in investors exiting the company, amounting to 26.37%. This exit trend has sparked discussions about the durability of this rally for RIOT in the future. On the positive side, CleanSpark (CLSK) recorded a gain of 5.9% within the market, mirroring the performance of other mining stocks.
Why Are Bitcoin Mining Firms Surging?
In the weeks prior to the Bitcoin halving, there were several predictions that mining businesses would experience significant decreases in value. The reason for this was the upcoming 50% reduction in mining rewards and the intense competition that most companies were facing.
In light of recent developments, it appears that miners have reduced their selling pace noticeably, suggesting that they held onto their Bitcoins from earlier sales and are now more prepared for the upcoming halving event. The optimistic outlook among traders, who anticipate a price surge for Bitcoin, has caused mining stocks to rise, bringing in greater financial prospects for these companies.
In 2021, investors who shorted crypto stocks believed that the excitement surrounding potential Bitcoin ETF approvals and the halving event would fade away, making their bets profitable.
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2024-04-20 03:41