Key Points
- Bitcoin mining stocks surged by 25% as Bitcoin’s price exceeded $70,000 and miners expanded into artificial intelligence (AI).
- Top public-listed Bitcoin mining companies in the US saw their stock prices rise significantly, with some firms benefiting from AI integration.
On Monday, the stocks of Bitcoin mining companies experienced a significant increase, soaring by 25%. This happened as the price of Bitcoin (BTC) rallied above $70,000. This surge happened just before the US election results, with macro indicators indicating a potential victory for Donald Trump. Additionally, the move into artificial intelligence (AI) by Bitcoin miners has presented new opportunities for revenue growth.
Contrasting with other cryptocurrency firms, Bitcoin mining stocks have been underperforming in recent months. After the Bitcoin halving event, Bitcoin miners found themselves in a challenging situation with rewards dropping by 50% and operational costs increasing. However, it appears that the difficult times for the crypto mining industry could be coming to an end.
Surge in Bitcoin Mining Stocks
On October 28, leading publicly-listed Bitcoin mining companies in the US witnessed their stock prices surge between 12-20%. This was in line with a broader equity market rally on Wall Street. Stocks of Marathon Digital, Hut 8 Corp, and Core Scientific saw significant increases. Mitchell Askew, the head analyst at Bitcoin mining company Blockware, stated that deficit spending and lower interest rates are driving global liquidity higher. He also noted that investors are fearful of high inflation over the long term.
Askew also mentioned that Bitcoin miners who could no longer operate profitably after the halving event in April have now exited the market. These miners had been creating significant selling pressure in the market, and their exit could positively impact Bitcoin’s price.
Bitcoin Miners and AI
Some of the top Bitcoin miners have adapted their operations to meet the growing demands of the Bitcoin mining industry. According to Askew, Bitcoin mining companies are finding success by expanding into AI and high-performance computing.
On October 28, several mining stocks saw significant gains. Among the top performers was Singapore’s Bitdeer Technologies with a 24.4% increase. Other notable performers included IREN and Gryphon Digital Mining.
One of the top-performing Bitcoin miners who has benefitted from the early transition to AI is Core Scientific. The company’s stock has risen by a massive 312% since the beginning of 2024 and is currently trading at $14.20. Earlier this year, Core Scientific signed a 12-year deal with AI hyperscaler CoreWeave, potentially generating up to $3.5 billion in revenue. The company has now secured three contracts.
Before Monday’s opening bell, Jefferies analyst Jonathan Peterson issued a “buy” rating on Core Scientific. He commended the company’s impressive comeback story as it leverages its significant access to power to build AI-focused data centers.
Adam Sullivan, CEO of Core Scientific, also stated that the company plans for exponential growth in the coming year. He noted that signing up another 500MW or 1GW of deals over the next few years could potentially elevate the company’s value to $25 to $30 billion.
