These crypto-related stocks have soared as much as 200% this year. here’s why

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Welcome to Distributed Ledger. Meet Frances Yue, crypto reporter at MarketWatch.

Crypto miners had a stellar start to the year as bitcoin BTCUSD rose 0.36% to around $24,000 from below $17,000 in early January.

Meanwhile, Dogecoin DOGEUSD, -2.15% rallied as Elon Musk would advance Twitter’s payment system and consider adding crypto to it.

But Charlie Munger, vice chairman of Berkshire Hathaway, called for a crypto ban in the US

Find me on Twitter at @FrancesYue_ to share your thoughts on crypto, this newsletter, or your personal stories with digital assets.

Gathering of miners

Bitcoin mining stocks are soaring, having suffered a tough year in 2022 thanks to high energy costs, lackluster bitcoin prices and high mining difficulty.

Riot Platforms Inc. RIOT, +9.18%, is up around 119% so far this year, and rival Marathon Digital Holdings MARA, +6.38%, has jumped 132% in the same year. period. Ebang International Holdings Inc. EBON, +8.44% has seen its shares rise nearly 200% since the start of the year. Hive Blockchain Technologies HIVE, +11.02%, jumped 183%, and Hut 8 Mining Corp. HUT, +11.57%, is up 179% since the start of the year.

The rally echoed the rally in other risky assets, the tech-heavy Nasdaq Composite COMP, +3.25% up 16% so far this year. It could also be attributed to improving fundamentals for crypto miners, analysts said.

While bitcoin is up 45% year-to-date, miners have seen their profit margins widen significantly, according to Andy Long, chief executive of White Rock Management. Margins were very tight in December. Many miners had production costs that came uncomfortably close to the price of the coin, Long told Distributed Ledger on a call.

Meanwhile, although bitcoin mining difficulty has hit an all-time high since Wednesday, it hasn’t increased as much as some miners had expected, Long noted.

Mining difficulty measures how hard it is to find a block of bitcoins when the number increases, miners have to put more computing power to mine a coin. The difficulty level is programmed to increase when there are more miners, and vice versa, to keep the bitcoin mining pace steady.

Global energy prices, which soared last year after Russia invaded Ukraine, have also fallen, thanks in part to a relatively mild winter in Europe and the continent’s conservation efforts. . We were looking forward to a possibly more peaceful summer in terms of energy prices, Long noted.

Phil Harvey, managing director of Sabre56, said that while he doesn’t think the bear market is over yet, most miners will see breakeven or profit as long as bitcoin is trading above 18. $000.

quote of the week

“A cryptocurrency is not a currency, commodity or security. Instead, it is a gambling contract with an almost 100% house edge, made in a country where the Gambling contracts are traditionally regulated only by states that compete with laxity.

Charlie Munger, Vice Chairman of Berkshire Hathaway

Munger once again slammed the crypto, this time in a Wall Street Journal op-ed on Wednesday. He blamed the miserable excess of cryptocurrencies that are issued by private companies but then went public without prior government approval of the disclosures, and suggested the US should follow China in banning crypto .

Sometimes large chunks of crypto are sold to a promoter at a low price and inflated when the public buys without fully understanding the pre-dilution in favor of the promoter, Munger wrote.

MarketWatchs Anviksha Patel wrote more here.

Doge jumped

Dogecoin has gained 9.6% in the past seven days, as the Financial Times reported on Monday that Twitter has advanced its efforts to build a payment system and crypto could be part of it.

Twitter applied regulatory licenses and built the software it needed to enable payments through the site, the report said. Musk expects the payment system to use fiat currencies first, but be designed in such a way that crypto functionality could potentially be added later, according to the report, citing unnamed sources.

The news has revived some crypto enthusiasts with hopes that the social media giant will provide more use cases for digital assets, especially for the Dogecoin meme token, of which Musk has been a longtime supporter.

Crypto at a Glance

Bitcoin prices have risen 3.9% over the past week and were trading at around $23,848 on Thursday, according to data from CoinDesk. Ether ETHUSD, +2.35% gained 3.8% over the same period to hit around $1,678, according to data from CoinDesk.

Biggest Winners Price 7 Day Return Render $1.75 97.9% dYdX $3.35 73.2% Fantom $0.63 53.8% Radix $0.06 45.2% Loopring 0, $43 43.3% Source: CoinGecko as of Feb 2. $3.35 -5.5% BitDAO $0.55 -4.5% Lido DAO $2.42 -4.2% Aptos $17.72 -4.5% Source: CoinGecko as of Feb 2 Crypto Companies, funds

Shares of Coinbase Global Inc. COIN, +23.99% rose 49.6% for the week to around $79.37. MicroStrategy Inc. MSTR, +9.04% is up 18.8% so far on the week, at $291.50.

Crypto mining company Riot Blockchain Inc. RIOT, +9.18%, jumped 20.8% to $7.41 on Thursday. Shares of rival Marathon Digital Holdings Inc. MARA, +6.38%, were down 8.1% at $8.02, over the past week. Ebang International Holdings Inc. EBON, +8.44%, rose 8.3% over the past week and traded at $8.89.

Shares of Overstock.com Inc. OSTK, +3.12%, were trading up 1.6% at $24.78, during the week.

Shares of Block Inc. SQ, +5.38%, formerly known as Square, gained 7.7% to $87.49 for the week so far. Tesla Inc. shares TSLA, +3.78%, up 17.8% to $189.14.

PayPal Holdings Inc. PYPL, +4.88%, advanced 6.7% on the week, to trade at around $86.18. Nvidia Corp. NVDA +3.66% added 8.3% to $214.51 last week.

Advanced Micro Devices Inc. shares AMD +4.34% climbed 16% to $87.20 for the week.

Among crypto funds, ProShares Bitcoin Strategy BITO, +1.22% was up 2.6% on the week to $14.91 on Thursday, while its counterpart Short Bitcoin Strategy ETF BITI, -1.07% was down 3.7% to $26.96. Valkyrie Bitcoin Strategy ETF BTF, +1.17% edged up 0.9% over the past week to $9.48, while VanEck Bitcoin Strategy ETF XBTF, +0.79% climbed 4.4 % at $24.32.

Grayscale Bitcoin Trust GBTC, +2.21%, is up 5.4% over the past five days to hit $12.82 on Thursday.

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