There were two major stories for popular cryptocurrency Bitcoin during this past week, causing disparate reactions from the market.
Shareholders are already well aware, but Bitcoin stocks can trade as volatilely as Bitcoin itself.
Furthermore, there weren’t any prominent Wall Street analysts weighing in on the stocks and causing the price per share to fluctuate.
Because of this, Shultz said that its data suggests 4.7 million and 5.9 million shares of CleanSpark will be purchased for exchange-traded funds and index funds between now and June 25.
That said, I’d expect CleanSpark, Marathon Digital, and Canaan to trade up and down with the price of Bitcoin because it’s the most fundamental part of their businesses.
However, a representative clarified by email the following day that Canaan management expects to generate between $150 million and $250 million in revenue in the second quarter.
With Bitcoin trading at around $36,600 as of this writing, these bitcoins are valued at over $200 million or about 7.5% of its market capitalization — no small number.
But the price of Bitcoin is the more important factor — a well-run Bitcoin business isn’t a compelling investment when the price of Bitcoin is cratering.
The only issue is sometimes shares trade at a premium to the underlying Bitcoin assets — right now the premium is about 19%.
Once Osprey Bitcoin Trust trades closer to its net asset value, it may be a good way to invest in Bitcoin.