Major crypto and Bitcoin mining-related stocks tumbled as much as 17% on the first day of trading on the Nasdaq in 2024, days ahead of an anticipated spot Bitcoin ETF announcement.
However, a Bitcoin (BTC) analyst told Cointelegraph it was a “healthy pull back” after a strong December.
According to Google Finance, Bitcoin mining firms were hit the hardest during the day. Shares in Marathon Digital Holdings (MARA) tumbled 16.6% to $23.5 while Riot Platforms (RIOT) fell 12.1% to $15.5.
Hut 8 Corp (HUT) and Hive Digital Technologies (HIVE) also fell 17.3% and 15.1%.
HUT share price on Jan.1, 2024. Source: Google FinanceMicrostrategy (MSTR), a business intelligence firm viewed as a proxy for Bitcoin, fell 5.4% to $631.6. However, this fall was largely offset by BTC’s recent price surge to $45,000 across Jan. 1-2, as the firm currently holds 189,150 BTC on its balance sheet.
Shares in crypto exchange Coinbase (COIN) — which increased over 400% in 2023 — fell 6.6% to $173.9 and has fallen another 1.25% to $171.7 in after-hours trading on Jan. 1.
COIN share price on Jan.1, 2024. Source: Google FinanceHowever, the market dip was described as a “healthy pull back” by Mitchell Askew, head analyst at Bitcoin mining firm Blockware Solutions.
This was also partly triggered by some Christmas and New Year profit taking, Askew told Cointelegraph.
“[Bitcoin mining firms] were over extended beyond their previous 2023 highs despite BTC being flat at 43k for the month of December,” Askew added.
Related: Marathon, Riot among most overvalued Bitcoin mining stocks: Report
Markus Thielen, head of research at cryptocurrency financial services firm Matrixport, shared a similar view:
“[We] warned [to investors] that their stock prices had reached fair value vs. bitcoin last week or, in some cases, were even overvalued.”
The big fall in share prices from Bitcoin mining companies may also be related to investor concerns that the Bitcoin halving event — which is set to take place in April — will impact its balance sheets, Askew noted.
But he said those concerns were largely “unsubstantiated.”
“Public miners have the most efficient ASICs and lowest power costs, allowing them to survive the halving without any issues,” he said.
Bitcoin increased 152% to $42,325 in 2023 but it was outperformed by at least 15 cryptocurrency-related stocks, according to nsquaredcrypto.
MARA was one of the best cryptocurrency-related stock performers in 2023, increasing nearly 600%.
In 2023 most Bitcoin-related stocks performed better than #Bitcoin itself. pic.twitter.com/fzSojcVQUe
— Timothy Peterson, CFA CAIA (@nsquaredcrypto) December 31, 2023
Magazine: How to protect your crypto in a volatile market: Bitcoin OGs and experts weigh
