Bitcoin mining stocks account for 25% of shares traded for top large caps, outperforming BTC into new year

Yesterday’s stock market, Dec. 27, reflected a surge in investor interest in Bitcoin-related stocks ahead of potential ETF approvals.

Bitcoin mining companies’ stocks soared, outstripping the cryptocurrency’s gains amidst anticipating an imminent spot Bitcoin ETF approval. Marathon (MARA) led the charge as trading volumes swelled, surpassing even Tesla’s activity on the trading floor.

Per Yahoo Finance data, Marathon’s shares escalated to $31.07, marking a 15.24% increase, with a trading volume reaching a towering 105.657 million, significantly beyond its 3-month average of 47.8 million. Further, for all stocks over the $100 million market capitalization threshold, Marathon ended the day (including after-hours trading) second behind Niokola. This bullish behavior dwarfed Bitcoin’s performance, which saw a more modest 3% increase during US trading hours.

Bitfarms (BITF), TeraWulf (WULF), and Riot Blockchain (RIOT) also witnessed notable trading fervor, with trading volumes at a combined 148 million shares traded, around double the average volume for the stocks.

Bit Digital (BTBT), CleanSpark (CLSK), Canaan (CAN), and Cipher Mining (CIFR) completed the top performers’ list, up 18.57%, 14.40%, 5.28%, and 5.82%, respectively. These companies also experienced trading volumes that were significantly higher than their recent averages, showcasing the high market interest.

Notably, the top 35 stocks (over $100 million market cap) recorded a total volume of 1.45 billion shares traded. Of those shares, 372 million were related to Bitcoin mining, which accounts for around 25% of shares traded within this segment.

The upswing in these stocks stresses the broader market interest in the Bitcoin space and a desire to gain exposure to stocks with potentially high beta to impending spot Bitcoin ETFs. This movement and the day’s trading data suggest a market brimming with anticipation and a keen eye on the regulatory horizon.

Further, as we approach the next halving in 2024, the current soaring Bitcoin transaction fees are buoying miners, hoping that continually elevated fees can offset the drop in block rewards. If miners can handle the halving better than anticipated due to the Inscription-related fee increase, the mining companies could post outsized returns compared to historical post-halving estimates.