Who says that bitcoin and the stock market aren’t correlated? Following bitcoin’s meteoric rise beyond the $50,000 line a few days ago, it looks like several crypto-based stocks are potentially following in the asset’s footsteps and are now trading at new highs for the year.
Crypto Stocks Have Been Firing on All Cylinders
Bitcoin has been on a serious roll as of late. In fact, it can be said that the currency has been on a bullish run for almost a year now, having shot up to about $9,000 in May of last year after hitting a new low before the $4,000 mark. Still, things took a heavy turn in October when the currency shot up to about $13,000 from its previous $10,000, and it’s been reaching new highs ever since.
There has also been a heavy argument over the years that both bitcoin and the stock market are correlated, and that when one goes up or down, the other is likely to follow suit. As we’re seeing right now, this argument may have some truth behind it, as several crypto-related stocks are boosting themselves and crossing some impressive price lines.
Some examples include KR1, a London-listed digital investment company. The firm has seen its stock shares spike by an impressive 800 percent in just the last three months. The company has built its reputation off investing in alternate currencies such as Ethereum and Polkadot, and now it looks like those investments are starting to pay off as everyone is eager to get their fingers on crypto.
In a statement, George McDonaugh – the managing director of the London-based enterprise – said:
KR1 was set up to allow investors access to the crypto economy via a publicly-listed company. Cryptocurrency stocks are outperforming the underlying assets because of the infrastructure that allows people to invest in public stock, such as 401Ks and ISAs. If you can tax-wrapper something as explosive as crypto, that makes a lot of sense in a lot of investor’s eyes.
We have also witnessed many crypto mining stocks shoot up in the past few months. Marathon Digital Holdings in Las Vegas, Nevada is up by around 500 percent since December, while Riot Blockchain in Colorado has also shot up by around 400 percent.
Perhaps even more impressive is the currency share price of The9, based in Shanghai, China. The company has seen its stock rise by as much as 1,500 percent since late last year.
Some Previous Bets Are Being Cashed In
McDonaugh chimed in further, claiming:
There could be every possible shade of despair if digital assets fall by 90 percent again. It will mean we can start allocating capital again. Right now, we’re riding the success of projects we bet on during the 2018-19 bear market. We need to make sure we’re best positioned to take advantage of the tailwinds and we’re able to work harder if we enter a slow down.