Bitcoin-Related Stocks Undergo 'Healthy Pull Back' on Final Trading Day of 2023
Summary:
On the last trading day of 2023, cryptocurrency and Bitcoin-associated stocks experienced a slump of up to 17%, characterized as a "healthy pull back" by industry analysts. Bitcoin mining firms such as Marathon Digital Holdings, Riot Platforms, Hut 8 Corp, and Hive Digital Technologies registered significant losses, with Coinbase also experiencing a dip in its share value. Despite investor concerns over the potential impact of the impending Bitcoin halving event in April, experts dismissed these apprehensions, asserting that public miners could weather the event without issues.
Correction Notice: An initial version of this article erroneously reported a drop in stocks on the first trading day of 2024, rather than the final trading day of the preceding year. Cryptocurrency and Bitcoin-associated stocks, which experienced a slump of up to 17% on the last trading day of 2023, were simply undergoing a "healthy pull back", in the words of a Bitcoin analyst. Google Finance illustrates that Bitcoin miners took the hardest hit during this period. Marathon Digital Holdings' (MARA) shares plunged 16.6% to $23.5 and Riot Platforms' (RIOT) declined 12.1% to $15.5, both on December 29. Additionally, Hut 8 Corp (HUT) and Hive Digital Technologies (HIVE) depreciated by 17.3% and 15.1%, respectively. MicroStrategy (MSTR), perceived as a surrogate for Bitcoin, dropped 5.4% to $631.6. Shares of the cryptocurrency exchange, Coinbase (COIN) — which escalated over 400% in 2023 — diminished 6.6% to $173.9 and further shrunk by 1.25% to $171.7 in post-market trading on December 29. However, Mitchell Askew, chief analyst at Bitcoin mining company Blockware Solutions, characterized the market downturn as a "healthy pull back" in an interview with Cointelegraph. He stated that the mining firms had excessively outstretched beyond their previous 2023 highs, despite Bitcoin stagnating at 43k through December. Markus Thielen, the research officer at cryptocurrency financial services provider Matrixport, echoed Askew's insight, noting that they had already cautioned investors about the stocks attaining fair value versus Bitcoin the previous week, or becoming overvalued in certain instances. The significant depreciation in the share prices of Bitcoin mining corporations could also be attributed to investor anxiety about the impending Bitcoin halving event scheduled for April, which could potentially affect their financial statements, Askew observed. However, he termed these apprehensions as largely baseless, given that public miners possess the most efficient Application-Specific Integrated Circuits (ASICs) and lowest power expenses, enabling them to weather the halving event seamlessly. Even though Bitcoin appreciated by 152% to $42,325 in 2023, it was surpassed by a minimum of 15 cryptocurrency-related stocks as per nsquaredcrypto data. Marathon Digital Holdings was among the most prosperous cryptocurrency-associated stocks of 2023, rising almost 600%.
Published At
1/2/2024 4:41:10 AM
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