The cryptocurrency market’s price surge has led to substantial gains in various sectors, including Bitcoin (BTC) miners, blockchain-based companies, and yield farmers.
Bitcoin miners have witnessed a stock growth of more than 10% as the asset’s price hovers around $35,000, nearing its 17-month peak.
Marathon Digital Holdings (MARA) has experienced a 10.54% increase in its stock price, reaching $9.86. Similar trends can be observed in Riot Platforms (RIOT) and CleanSpark (CLSK), with gains of 10.68% and 12.08%, respectively.
This isn’t the first instance of mining-related stocks surging as the price of Bitcoin surpassed $30,000, marking a positive trend for the market and miners who have endured extended periods of uncertainty.
In recent months, digital asset miners endured losses due to declining prices, driven by a broader market downturn and significant industry setbacks. The price of Bitcoin dropped by over 55% last year, and the tightening regulations on miners exacerbated their challenges.
To survive these challenging times, miners had to explore unconventional strategies, such as selling mining equipment or liquidating their Bitcoin holdings, all in an effort to stay afloat until the next bullish market phase.
This year, there has been a notable shift as miners have started accumulating more Bitcoin, with their sights set on the halving event, which has the potential to herald another bullish cycle.
Marathon Digital has reported an impressive 188% increase in its stock price this year, while Riot Platforms and CleanSpark have achieved gains of 231% and 128%, respectively, during the same period.
Institutional products see growth
The impact of surging prices is evident across digital asset-based products in various regions. In the past week, these products experienced the highest influx in 18 months, totaling $326 million, with Bitcoin accounting for 90% of these inflows.
Bitcoin products attracted inflows of $296 million, and even short Bitcoin products, which had been trading in the range of $1 million to $2 million for several weeks, saw gains of $15 million.
Among alternative cryptocurrencies (altcoins), Solana (SOL) emerged as the standout performer, drawing in $24 million and maintaining its status as a favorite among institutional investors. In contrast, Ethereum (ETH) saw outflows of $6 million during this period.
Spot ETF on the horizon
The primary driver behind the surge in miner stocks and the increased influx of funds into digital asset products is the recent resurgence in cryptocurrency prices, following several months of decline.
Experts at CoinShares have pointed to the optimism surrounding the potential approval of a spot Bitcoin (BTC) Exchange-Traded Fund (ETF) by the U.S. Securities and Exchange Commission (SEC) as a key factor attracting significant investments in the sector. Several leading firms have projected the possibility of such an approval occurring in 2024.
Monthly inflows into the sector now exceed $400 million, with the United States contributing only 12% of this total. The majority of these inflows are recorded in countries such as Canada, Germany, and Switzerland, with figures of $134 million, $82 million, and $50 million, respectively.