The stock prices of Marathon Digital (MARA), Coinbase (COIN), MicroStrategy (MSTR), and Bitfarms (BITF) were soaring in the pre-market session on Monday. MARA stock surged by over 5.7%, Coinbase jumped by 5.8%, MicroStrategy rose by 8.7%, and Bitfarms soared by 10%. Other crypto-focused companies like CleanSpark, Riot Platforms, Iris Energy, and Core Scientific also saw significant jumps in their stock prices on Monday.
The primary reason behind the surge in these stocks is the strong recovery of Bitcoin, which has moved into a bull market. After dropping to a multi-month low of $53,700 earlier in the month, Bitcoin rallied to over $62,000. The recent rally was also fueled by Germany concluding its sale of over 50,000 Bitcoins from its reserves, which impacted the price of the cryptocurrency. With these sales completed, analysts expect Bitcoin to continue rising in the coming weeks.
Bitcoin’s price also rose following the shooting incident involving Donald Trump at a rally in Pennsylvania, leading to speculation that Trump could win the upcoming general election. Trump has garnered support from high-profile figures like Elon Musk and Bill Ackman and is perceived as the most crypto-friendly presidential candidate. On the other hand, a potential victory for Joe Biden could result in Gary Gensler retaining his position as SEC chair, a scenario that has drawn criticism from the crypto community.
There is also anticipation that the SEC could approve a spot Ethereum ETF, which has further boosted the prices of Bitcoin and other cryptocurrencies. Some analysts believe that the approval could happen as early as this week, contributing to Ethereum’s price entering a bull market with a 20% increase from its recent low. This approval could have positive implications for Bitcoin and other cryptocurrencies.
Companies like Marathon Digital, Coinbase, MicroStrategy, and Bitfarms have seen their stock prices surge due to their involvement in the cryptocurrency industry. Bitcoin mining companies like Marathon Digital and Bitfarms benefit from robust Bitcoin prices as they mine and sell Bitcoins for profit, holding some coins in their balance sheets. MicroStrategy is the largest Bitcoin holder globally, while Coinbase is the largest crypto exchange in the US, thriving when Bitcoin and other coins rise in value.
The recent strong performance of these stocks can also be attributed to positive US economic data, which has raised the possibility of interest rate cuts by the Federal Reserve. With headline and core inflation dropping to 3.0% and 3.20%, analysts anticipate a 0.25% interest rate cut by the Fed as early as its September meeting. Bitcoin and related stocks often perform well when there are expectations of rate cuts by the central bank. As a result, the stock prices of MARA, COIN, MSTR, and BITF have been soaring in response to these factors.
In conclusion, the surge in the stock prices of Marathon Digital, Coinbase, MicroStrategy, Bitfarms, and other crypto-related companies can be attributed to the recovery of Bitcoin, potential political developments favoring crypto-friendly candidates, anticipation of an Ethereum ETF approval, and positive US economic data. These companies stand to benefit from the growing adoption and interest in cryptocurrencies, with their stock prices reflecting these positive developments in the industry.
