Bitcoin mining companies are facing a significant decline in their stock prices as they prepare for the upcoming halving.
Shares of Marathon Digital Holdings, Riot Platforms and CleanSpark fell for a third straight day. Marathon Digital Holdings, the largest public Bitcoin miner, has lost nearly 25% of its stock value over the past month, while Riot Platforms has lost nearly 30%. Additionally, the Valkyrie Bitcoin Miners exchange-traded fund has lost about 28% of its value this month.
Stock prices have continued to fall as investors prefer safer assets due to increased short selling of cryptocurrency mining stocks and geopolitical tensions due to the recent conflict between Iran and Israel.
Despite these challenges, CEOs of these mining companies remain optimistic, according to Bloomberg. The cost-effective operations of mining companies, advanced mining technology, and increased demand for cryptocurrencies are potential compensating factors for the expected $10 billion annual revenue loss due to the upcoming Bitcoin halving.
Moreover, the companies are hoping that the surge in demand resulting from the new spot ETF will boost the price of Bitcoin enough to offset the side effects of the update. Since being introduced by traditional asset managers in January, these ETFs have collectively generated net inflows of $12.4 billion.
The recent approval of a Bitcoin ETF in Hong Kong has also sparked significant optimism from cryptocurrency leaders. Sumit Gupta, co-founder of CoinDCX, one of India’s largest exchanges, shared his enthusiasm over the approval of Asia’s first major ETF in comments shared with crypto.news.
“Institutional participation has historically been a driving force behind the increased interest and traction observed across a variety of asset classes. The fact that these developments first occurred in Asia brings us closer to home, emphasizing the global nature of this developing story. “The trajectory of the cryptocurrency industry is gradually moving in a direction that drives adoption, which represents promising prospects for future growth and mainstream acceptance.”
– Sumit Gupta, Co-Founder of CoinDCX