Ethereum

Bitcoin

<p class="is-style-lead">What impact are Bitcoin and Ethereum rallies having on crypto-related stocks, and will this bullish trend continue?</p> 
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  <ul>
   <li><a href="#whats-happening-with-coinbase" rel="">What’s happening with Coinbase?</a></li>
   <li><a href="#microstrategys-bitcoin-bet" rel="">Microstrategy’s Bitcoin bet&nbsp;</a></li>
   <li><a href="#whats-the-largest-btc-miner-up-to" rel="">What’s the largest BTC miner up to?</a></li>
   <li><a href="#what-to-expect-next" rel="">What to expect next?</a></li>
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<p>After weeks of bearish sentiment and market consolidation, the crypto market has made a comeback in the last 24 hours.&nbsp;</p> 
<p>Bitcoin (<a href="https://crypto.news/price/bitcoin/" rel="">BTC</a>) has surged past the $70,000 mark, trading at $71,000 as of May 21. Ethereum (<a href="https://crypto.news/price/ethereum/" rel="">ETH</a>) has experienced an even more dramatic <a href="https://crypto.news/ethereum-jumps-17-on-increased-etf-approval-odds/" rel="">rise</a>, jumping over 20% to trade above $3,700.</p> 
<p>This rally follows a key announcement by Eric Balchunas, a senior analyst at Bloomberg, who increased the odds of an Ethereum exchange-traded fund (<a href="https://crypto.news/tag/etf/" rel="">ETF</a>) approval from 25% to 75%.&nbsp;</p> 
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   <p lang="en" dir="ltr">Update: <a href="https://twitter.com/JSeyff?ref_src=twsrc%5Etfw" target="_blank" rel="">@JSeyff</a> and I are increasing our odds of spot Ether ETF approval to 75% (up from 25%), hearing chatter this afternoon that SEC could be doing a 180 on this (increasingly political issue), so now everyone scrambling (like us everyone else assumed they'd be denied). See… <a href="https://t.co/gcxgYHz3om" target="_blank" rel="">https://t.co/gcxgYHz3om</a></p>— Eric Balchunas (@EricBalchunas) <a href="https://twitter.com/EricBalchunas/status/1792636523050906102?ref_src=twsrc%5Etfw" target="_blank" rel="">May 20, 2024</a>
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<p>Balchunas noted that the U.S. Securities and Exchange Commission (<a href="https://crypto.news/tag/sec/" rel="">SEC</a>) appears to be accelerating its approval process, possibly due to political pressure and its previously cautious stance on ETFs.</p> 
<p>The bullish sentiment is further <a href="https://crypto.news/bullish-hashrate-traders-expect-bitcoins-price-to-go-up-over-next-six-months/" rel="">evidenced</a> by the optimism among hashrate futures contract traders. Analysts at Hashrate Index predict a rise in hashprice over the next six months. They expect Bitcoin’s transaction fees to increase and the price to continue its growth.&nbsp;</p> 
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   <p lang="en" dir="ltr">📢 HASHPRICE &amp; HASHRATE MARKET UPDATE!<br><br>Hashrate Forwards are trading in contango since the Halving, with future hashprice quotes above spot price.<br><br>Bullish hashrate traders expect hashprice to rise over the next 6 months. They anticipate difficulty may fall/stagnate, transaction… <a href="https://t.co/4ZLgN6Jxyp" target="_blank" rel="">pic.twitter.com/4ZLgN6Jxyp</a></p>— Hashrate Index 🟧⛏️ (@hashrateindex) <a href="https://twitter.com/hashrateindex/status/1792716270724329816?ref_src=twsrc%5Etfw" target="_blank" rel="">May 21, 2024</a>
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<p>This sentiment is supported by their recent post on X (formerly Twitter), where they mentioned that Bitcoin’s price rally to $70,000 is positively impacting hashprice, despite it being relatively low compared to previous halving epochs.</p> 
<p>In response to the positive momentum in the crypto market, crypto-related stocks have also seen substantial gains.&nbsp;</p> 
<p>Coinbase (COIN) surged 9% on May 20, reaching $225. Similarly, MicroStrategy (MSTR) also rose by 9%, trading at $1,727, suggesting that the bullishness in the crypto market is spilling over into stocks linked to the crypto sector.</p> 
<p>In the light of these developments,&nbsp; let’s analyze how these stocks have performed recently and what we can expect next.</p> 
<h2 class="wp-block-heading" id="whats-happening-with-coinbase"><strong>What’s happening with Coinbase?</strong></h2> 
<p>Despite experiencing a revenue decrease in 2022 compared to 2021, Coinbase has <a href="https://companiesmarketcap.com/coinbase/marketcap/" target="_blank" rel="">become</a> the world’s 340th most valuable company, with a <a href="https://crypto.news/glossary/market-cap-in-crypto/" rel="">market cap</a> of over $55 billion as of May 2024.&nbsp;</p> 
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<p>After bottoming out at $47 per share in June 2022, Coinbase’s share price surged to $225 on May 20, representing a 378% increase. Over the past year, the stock has risen more than 268% and climbed over 113% in the last six months.&nbsp;</p> 
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<p>In 2023, Coinbase reported a revenue of $3.97 billion, a decrease from the $7.83 billion reported in 2021. However, the company’s first-quarter revenue for 2024 <a href="https://www.cnbc.com/2024/05/02/coinbase-coin-earnings-q1-2024.html" target="_blank" rel="">soared</a> to $1.6 billion, marking a 72% increase from the previous quarter.</p> 
<p>This surge in revenue and stock price is primarily driven by a boost in transactions, thanks to the wider crypto market’s upswing and a favorable change to crypto accounting rules.&nbsp;</p> 
<p>The company’s net income for the first quarter of 2024 was $1.18 billion, or $4.40 per share, a turnaround from a year-ago loss of $78.9 million, or 34 cents per share.&nbsp;</p> 
<p>Coinbase’s revenue drivers include consumer transaction revenue, which stood at $935 million for the quarter, and total transaction revenue, which almost tripled to $1.08 billion. Additionally, subscription and services revenue contributed $511 million for the quarter.</p> 
<p>The company also benefited from the surge in BTC and ETH prices during the first quarter. Bitcoin reached a new all-time high above $73,000 in March, while ETH underwent its first major upgrade in over a year. These events led to increased trading volumes and demand for Coinbase’s services.</p> 
<p>Furthermore, Coinbase has positioned itself as a key player in the institutional investor space, particularly since the approval of the spot <a href="https://crypto.news/best-crypto-etf-by-performance/" rel="">BTC ETF</a> by the SEC in the U.S. Many of these funds have partnered with Coinbase as their custody partner, collectively boosting demand for Coinbase and its services.</p> 
<p> You might also like: <a href="https://crypto.news/where-billionaires-invest-why-13f-report-matters-for-the-crypto-industry/" rel=""> Where billionaires invest: why 13F report matters for the crypto industry </a> </p> 
<h2 class="wp-block-heading" id="microstrategys-bitcoin-bet"><strong>Microstrategy’s Bitcoin bet&nbsp;</strong></h2> 
<p>MicroStrategy, ranked as the world’s 654th most valuable company by market cap as of May 2024, has experienced notable fluctuations in its market cap over the years.</p> 
<p>Between 2020 and 2024, the company’s market cap <a href="https://companiesmarketcap.com/microstrategy/marketcap/" target="_blank" rel="">surged</a> from $3.60 billion to $30.63 billion, marking a 750% increase. This surge is particularly impressive considering the company’s market cap declined by 73.42% to $1.63 billion by the end of 2022.</p> 
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<p>The company’s share price also tells an interesting story. Between 2000 and 2020, MSTR’s share price remained relatively stagnant, hovering between $100 and $150 with no major upswing.&nbsp;</p> 
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<p>However, since 2020, the share price has been on a steady rally, gaining over 1180% in the last five years and nearly 500% in the last year alone, trading at $1,727 as of May 20.</p> 
<p>Despite these positive trends, MicroStrategy’s revenue has seen some fluctuations. In 2023, the company reported a revenue of $0.48 billion, a decrease from the $0.51 billion reported in 2021. Similarly, the company’s revenue in 2022 decreased to $0.49 billion from $0.51 billion in 2021.</p> 
<p>MicroStrategy’s price-to-earnings ratio (P/E ratio) is another metric worth noting. As of the latest financial reports, the company’s P/E ratio stands at 200.144, a stark increase from -1.09 at the end of 2022.&nbsp;</p> 
<p>The high P/E ratio indicates that investors are willing to pay a premium for MicroStrategy’s earnings, possibly due to the company’s strong performance and growth potential. However, high P/E stocks usually carry substantial risks.</p> 
<p>One key factor contributing to MicroStrategy’s recent success is its substantial bitcoin <a href="https://www.microstrategy.com/press/microstrategy-announces-first-quarter-2024-financial-results-now-holds-214-400-btc_04-29-2024" target="_blank" rel="">holdings</a>. As of Q1 2024, the company holds 214,400 bitcoins, valued at approximately $15.26 billion as of May 21.&nbsp;</p> 
<p>These holdings, acquired at an average cost of $35,180 per bitcoin, have generated a paper profit of around $7.76 billion for MicroStrategy.</p> 
<p>Meanwhile, MicroStrategy’s <a href="https://www.bloomberg.com/news/articles/2024-05-15/bitcoin-proxy-btc-microstrategy-mstr-added-to-msci-world-stock-index" target="_blank" rel="">addition</a> to the MSCI World Index further validates its position as a key player in the stock market.&nbsp;</p> 
<p>The MSCI World Index is a broad global equity-market index comprising nearly 3,000 companies from 23 developed countries and 24 emerging markets. MicroStrategy’s inclusion in this index suggests growing BTC exposure in traditional portfolios.</p> 
<h2 class="wp-block-heading" id="whats-the-largest-btc-miner-up-to"><strong>What’s the largest BTC miner up to?</strong></h2> 
<p>Marathon Digital Holdings (MARA), the world’s 2,379th most valuable company by market cap as of May 2024, has experienced extreme volatility in its market cap over the years.&nbsp;</p> 
<p>Between 2020 and 2024, the company’s market cap surged from $0.85 billion to $6.09 billion, marking a 616% increase. This surge followed a sharp decline in 2022, where the market cap dropped by 88.15%.</p> 
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<p>The company’s revenue trends also reveal an interesting narrative. Marathon’s 2023 revenue stands at $0.38 billion, an increase from $0.11 billion in 2022 and $0.15 billion in 2021.&nbsp;</p> 
<p>Despite these improvements, Marathon has faced challenges, as evidenced by its current P/E ratio of -5.16667. At the end of 2022, the P/E ratio was -0.5516.</p> 
<p>The negative P/E ratio can be attributed to various factors, including operational challenges, unexpected equipment failures, transmission line maintenance, and weather-related curtailments at its mining sites.&nbsp;</p> 
<p>Meanwhile, Marathon’s stock performance over the years has been strong, with the share price rallying nearly 617% over the past five years and approximately 121% in the last year. </p> 
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<p>In the first week of May, Marathon’s stock was <a href="https://www.fxstreet.com/cryptocurrencies/news/bitcoin-miner-marathon-digital-stock-gains-ground-after-listing-by-sp-global-202405070223" target="_blank" rel="">listed</a> by S&amp;P Global, a crucial milestone for the company. Despite this positive development, Marathon faced operational challenges in the first quarter of 2024, mining only 2,811 Bitcoins, a 34% decrease from the previous quarter.&nbsp;</p> 
<p>As a result, Marathon <a href="https://www.google.com/search?client=safari&amp;rls=en&amp;q=marathon+eps+q1+2024&amp;ie=UTF-8&amp;oe=UTF-8" target="_blank" rel="">reported</a> first-quarter earnings per share (EPS) of $1.26, well above Wall Street estimates of $0.02. However, this figure included a favorable mark-to-market adjustment due to newly approved FASB fair value accounting rules and the recent increase in bitcoin prices, making the comparison to forecasts complex.</p> 
<p>Amid these challenges, the company remains bullish on its future, maintaining its 2024 guidance of ramping up to 50 exahash per second (EH/s) and anticipating additional growth in 2025.</p> 
<h2 class="wp-block-heading" id="what-to-expect-next"><strong>What to expect next?</strong></h2> 
<p>The future of the crypto market largely hinges on its performance in the coming months.&nbsp;</p> 
<p>Should the market continue its upward trajectory, we can expect a ripple effect benefiting crypto-related stocks. Conversely, any downturns will likely have an adverse impact on these stocks.&nbsp;</p> 
<p>Currently, the momentum is positive, with Bitcoin Trading well above $70,000 and Ethereum experiencing a wild surge, reaching around $3,700.</p> 
<p>A critical factor to watch is the potential approval of an Ethereum ETF. If approved, it would be a strong bullish signal, likely driving up prices further and driving more investment in both crypto and related stocks.</p> 
<p>Despite the optimistic outlook, you should exercise caution. The crypto market is notoriously volatile, and sudden shifts can lead to substantial losses.&nbsp;</p> 
<p>Diversifying investments and having a clear risk management strategy are essential to navigate the uncertainties in this space. Never forget the golden rule of investing: never invest more than you can afford to lose.</p>

Crypto market rebounds, lifting crypto-related stocks: what’s next?

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