As the digital currency giant Bitcoin stages an impressive rally and surges beyond the $64,500 mark, excitement and anticipation have again begun to grip market participants. The cryptocurrency market's volatility and thrill continue to captivate seasoned investors and curious newcomers.
While Bitcoin grabs headlines, crypto-related stocks offer an alternative path into this realm. These stocks provide an alternative avenue to gain exposure to the industry without diving directly into virtual currencies.
But First, Why Is Bitcoin Rallying?
The latest CPI data, which came in below expectations last week, has sparked the current Bitcoin rally. This suggests inflation might be cooling off, raising hopes for potential Fed rate cuts. Lower rates generally benefit high-risk assets like cryptos. Additionally, political developments are adding to the momentum. Republican presidential candidate Donald Trump named Sen. J.D. Vance as his running mate. Vance, a former venture capitalist, is seen as crypto-friendly, further boosting investor sentiment.
Four Crypto Stocks Gaining Attention Amidst Bitcoin's Latest Price Surge
1. Marathon Digital Holdings
Marathon Digital Holdings (NASDAQ: MARA), based in Las Vegas, focuses on Bitcoin mining. Initially a patent company, it rebranded in 2020 and partnered with a Montana coal plant for mining power. Led by CEO Fred Thiel, the team comprises finance and tech experts.
MARA started this week with a bang, surging close to 20% on Monday. This move made its stock positive year-to-date, now up close to 5%. Notably, MARA also broke out of consolidation above all major moving averages. If Bitcoin remains firm and continues its steady move, MARA might outperform in the short term due to its lengthy consolidation breakout and hefty short interest.
2. iShares Bitcoin Trust
iShares Bitcoin Trust (NASDAQ: IBIT) is an exchange-traded fund that primarily invests in long Bitcoin and short USD currency positions. Launched on January 5, 2024, and issued by BlackRock, IBIT is a passively managed fund that seeks to track the spot price of Bitcoin. IBIT found support near $32 last week and surged over 10% on Monday to reclaim its 20-day SMA.
3. CleanSpark, Inc.
CleanSpark, Inc. (NASDAQ: CLSK) focuses on Bitcoin mining and creating eco-friendly setups for it. Based in Henderson, Nevada, the company aims to make Bitcoin more accessible for financial freedom and inclusion.
CLSK was up an impressive 15.46% on Monday. From a technical analysis perspective, CLSK is consolidating in a significant bullish pattern, with resistance and breakout confirmation near $20. If Bitcoin continues to rally and CLSK reclaims that zone, major upside might ensue. Like MARA, CLSK also has a hefty short interest.
4. Coinbase Global, Inc.
Coinbase Global Inc. (NASDAQ: COIN) is a leading cryptocurrency exchange providing various digital asset trading services. The retail favorite was up an impressive 11.3% on Monday, thanks to Bitcoin's strength and overall market resilience.
On a higher timeframe, shares of Coinbase look ripe for a significant breakout after Monday's action, as the stock broke out of a multi-week consolidation and its 50-day and 20-day SMA. A higher timeframe breakout would be confirmed if the stock can break above $260 in the near term. However, the company is set to report earnings on August 1, which might significantly influence its overall direction.
Balancing Caution and Opportunity in Crypto Stock Investments
As Bitcoin reclaims critical levels and rebounds firmly, several leading crypto-related names are following suit, with some breaking out of significant and bullish consolidations. These stocks provide an alternative way to engage with the crypto market without directly handling digital assets. However, the cryptocurrency market's volatility demands caution and research. Before exploring these opportunities, it's prudent to understand the risks and dynamics of this ever-evolving space.
