Crypto Shares Ride Bitcoin Rally to Outstrip Energy, Financials
Global cryptocurrency-linked shares are outperforming the traditional equity sectors atop this year’s stock market leaderboard, helped by Bitcoin’s rally to the cusp of a record high.
A collection of two dozen global crypto stocks linked to coin mining, trading and investing has soared 91% this year. The performance of the Bloomberg-curated group compares with a 14% advance in the MSCI AC World Index and tops global equity sectors such as energy, financials and technology.
Speculative fervor for all things crypto-related has intensified amid the listing of the first Bitcoin-linked exchange-traded fund in the U.S. The volatile digital asset is trading around $64,000, close to its April peak.
Given the marked swings that can sweep across digital tokens, investment in crypto-linked stocks isn’t for the faint-hearted.
For instance, it remains to be seen if the ETF listing will stoke the next surge in Bitcoin prices or end up being an opportunity to take profits, according to Craig Erlam, senior market analyst at Oanda.
“Either could be the trigger for some pretty wild price action in the cryptocurrency space,” he wrote in a note.
Crypto miners lead the charge within the curated basket of stocks. Marathon Digital Holdings Inc., Hut 8 Mining Corp. and Bitfarms Ltd. are up at least 180% so far this year. Galaxy Digital Holdings Ltd., the crypto asset manager headed by Michael Novogratz, has doubled in value this year, the data show.
©2021 Bloomberg L.P.