Many investment experts and other smart people caution you to never put all your eggs in one basket, but in some cases, this strategy can really pay off. On Monday, a number of publicly traded companies that rely on certain cryptocurrencies, along with their underlying assets, posted sharp gains.
Virtual currency mining specialist cleanse park (NASDAQ: CLSK) While its peers rose nearly 20%, riot platform (NASDAQ: Riot) The stock price rose more than 9%.The person who topped both was crypto currency ultra bull Michael Saylor. micro strategy (NASDAQ:MSTR)ended the day up nearly 22%.
Committed to the best cryptocurrencies
There are no prizes for guessing which star cipher each of these businesses relies on.Yes, that is Bitcoin (Cryptocurrency: BTC)a coin that both Cleanspark and Riot Platforms are actively mining, and Microstrategy is eagerly pouring capital into purchasing.
Sure, this laser focus can be limited, but not if that asset is flying very high. In its relatively long history (more than 15 years), Bitcoin crossed the $70,000 price mark for the first time on Monday morning. And so far, as of this writing late that afternoon, it has held up.
This undoubtedly caught quite a few investors off guard. After all, the security that helped propel Bitcoin to new heights earlier this year, the recently introduced Spot Bitcoin Exchange Traded Fund (ETF), posted a net gain. spill last week.
according to coinbase The total amount of Bitcoin spot ETFs on the market from March 18 to March 21 reached $836 million, according to a research report released on Friday and cited by crypto outlets such as CoinDesk. did. This was the first weekly outflow recorded by Coinbase in the past two months.
However, you can't keep having good cryptocurrencies. While it's true that many investors exited Bitcoin due to the outflow of funds from Bitcoin spot ETFs, the resulting fall in Bitcoin's price attracted bargain hunters. Bullish mood abounds in the crypto world as the US Federal Reserve appears to be willing to cut key interest rates several times this year and inflation continues to ease (at least to some extent). .
prove the skeptics wrong
It is also important to keep in mind that Bitcoin will undergo very significant changes in the near future. This is the latest “halving” of cryptocurrencies, which simply means that the reward for mining the coin will be halved. This may seem like a distant memory to some, as the last halving occurred almost four years ago.
Nevertheless, the extremely low rewards for mining Bitcoin has led to a rush to the cryptocurrency. After all, miners want to start their engines for more profits before their pay goes down.
I was a Bitcoin skeptic for many years, but now the top cryptocurrency has a lot of green lights. Unless we get a red flash or two in the coming days or weeks, current values should hold pretty well. So are clean sparks, riots, and microstrategies that rely mostly or completely on it.
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Eric Volkman has a position in Bitcoin. The Motley Fool has positions in and recommends Bitcoin and Coinbase Global. The Motley Fool has a disclosure policy.
“Why Crypto Stocks Were Monster Winners on Monday” was originally published by The Motley Fool.
