The long-awaited day is finally here: Bitcoin has an ETF. And not just a foreign OTC-traded trust. A real ETF. A real way that average Joes can allocate retirement capital through 401k’s to a new asset class in direct fashion, rather than through arcane crypto wallets or exchanges in Mexico or some other means.
A simple, easy-to-use, direct process is now in play that is protected by the SEC. And it’s based on the Bitcoin futures market, which is a big plus.
As stated by Proshares CEO Simeon Hyman, “The futures market is a better place for price discovery. The CME futures market trades more volume than the largest US crypto exchange. We launched a similar mutual fund on 7/28 and since we launched on Friday, the Bitcoin Reference Rate is up 52 percent, our BTC mutual fund is up 52 percent and the BTC Greyscale Trust is up 37 percent… What we are trying to do is bring new projects into the investor-protected perimeter. BTC futures have been overseen by the SEC’s sister agency, The Commodities Futures Trading Commission, for the past four years. You have something that’s been overseen for the past four years by a federal regulator, and it’s also been wrapped up in the SEC’s jurisdiction through the Investment Company Act of 1940.”
The upshot is this: The establishment of a futures-based Bitcoin ETF ratified by regulatory authorities opens up US retirement and tax-advantaged accounts to holding bitcoin, which opens up a massive pile of available capital to the BTC market.
That’s an obvious plus for the value of Bitcoin, but investors may benefit even more from the higher-beta route: Bitcoin stocks.
Companies already lined up to reap the rewards of a favorable trend in the underlying coin through established operations in the mining space could be an even better route than simply buying the coin or the ETF (or the futures).
With that in mind, we take a look at some of the most interesting players in this space along with their recent catalysts.
HIVE Blockchain Technologies Ltd (NASDAQ:HIVE) is a central name in the space and a good place for investors to focus when keying off this theme. The stock is up about 1,000% over the past year, but has consolidated over the past 6 months.
The company engages, according to its materials, in building a bridge from the blockchain sector to traditional capital markets. HIVE owns state-of-the-art, green energy-powered data center facilities in Canada, Sweden, and Iceland. The company touts its shares as a source of exposure to the operating margins of digital currency mining, as well as a portfolio of cryptocurrencies such as ETH and BTC.
HIVE Blockchain Technologies Ltd (NASDAQ:HIVE) recently announced that it just achieved its target of 1 Exahash per second (EX/s) of Bitcoin mining hashrate.
“This is a monumental achievement for us as we continue to our goal of over 3 EX/s by the end of fiscal 2022, including the conversion of ETH, a goal which is greatly supported by today’s announcement of new miner deliveries,” Frank Holmes, Executive Chairman of HIVE continued, “This achievement has been challenging because of the global shortages in chips and logistics delays in shipping equipment from Asia due to Covid 19.”
And the stock has been acting well over recent days, up something like 19% in that time. Shares of the stock have powered higher over the past month, rallying roughly 35% in that time on strong overall action.
HIVE Blockchain Technologies Ltd (NASDAQ:HIVE) managed to rope in revenues totaling $45.7M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 401.5%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels exceeding current liabilities ($145.8M against $11.9M).
ISW Holdings (OTC US:ISWH) has been the best play in the space over the past few months, ripping as much as 1,000% higher since May as the company puts together a strong model combining hosting and mining that includes its landmark partnership with Bitmain Technologies, which is probably the best known and most important player in the cryptocurrency marketplace on the equipment side.
ISWH also recently filed for a name and ticker change to “BlockQuarry”, which further helps to bolster the story given the increasingly retail-investor-oriented nature of this equity bull market. The company now has partnerships in place with Bit5ive, Minerset, and Bitmain Technologies, and projects its best quarter ever as we move into the homestretch of 2021.
ISW Holdings (OTC US:ISWH) added to its narrative by announcing this week that the first phase of its Southeastern U.S. project to pair 56,000 mining rigs with 200 MW of power is now nearing completion, which constitutes the infrastructure build-out to deploy 20 MW of power to self-contained cryptocurrency mining Pods.
Larry Sossamon, President, and Chic Blanton, Vice President of Sossamon Construction Co., Inc., commented, “We are very excited to be working with the Bit5ive team, a leading pioneer in the crypto mining space, on this exciting project. We have made excellent progress as we near completion of the first phase of over 200MW of crypto mining parks in South and North Carolina. These projects represent some of the most innovative of their kind, and stand to create many new jobs and new opportunities in the area.”
Company management also notes that Bit5ive will begin delivering the first tranche of new mining Pods to the site over coming weeks.
ISW Holdings (OTC US:ISWH) Chair and President, Alonzo Pierce, also noted, “Even with supply chain issues, we have managed to manufacture in record time. We will continue to do our best to hit our schedule objectives despite difficult market conditions, and we are thrilled to start deploying our Gen4 Pods to the site as the project ramps up. We are also excited to report that engineering and planning have gotten underway on the next sites to be developed starting in early 2022.”
Riot Blockchain Inc (NASDAQ:RIOT) focuses on mining Bitcoin, and through Whinstone, its subsidiary, hosting Bitcoin mining equipment for institutional clients.
The Company is expanding and upgrading its mining operations through industrial-scale infrastructure development and latest-generation miner procurement. Riot is headquartered in Castle Rock, Colorado, and the Whinstone Facility operates out of Rockdale, Texas. The Company also has mining equipment operating in upstate New York under a co-location hosting agreement with Coinmint, LLC.
Riot Blockchain Inc (NASDAQ:RIOT) recently announced its latest production and operations updates, including its unaudited Bitcoin production for August 2021 and its miner deployment status.
According to its release, in August 2021, Riot produced 441 BTC, an increase of approximately 451% over its August 2020 production of 80 BTC. Year to date through August 2021, the Company produced a total of 2,051 BTC, an increase of approximately 221% over its production during the same 2020 period of 639 BTC. As of August 31, 2021, Riot held approximately 3,128 BTC, all of which were produced by its self-mining operations. The Company currently has a deployed fleet of approximately 22,050 miners, with a hash rate capacity of 2.2 EH/s.
The context for this announcement is a bit of a bid, with shares acting well over the past five days, up about 19% in that timeframe. Shares of the stock have powered higher over the past month, rallying roughly 11% in that time on strong overall action.
Riot Blockchain Inc (NASDAQ:RIOT) managed to rope in revenues totaling $34.3M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 1668.7%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels exceeding current liabilities ($220.2M against $37.5M).
Other core stocks in the Cryptocurrency and Bitcoin space include Canaan Inc – ADR (NASDAQ:CAN), Overstock.com Inc (NASDAQ:OSTK), MicroStrategy Incorporated (NASDAQ:MSTR), and ProShares Bitcoin Strategy ETF (NYSEAMERICAN:BITO).
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