Bitcoin Mining Stocks Will be Best BTC Proxy Bets If History Repeats

So far in 2024, the Bitcoin price has shown strength with most of the gains coming in the first quarter following the spot Bitcoin ETF launch. However, the Bitcoin mining stocks have given a laggard performance amid the BTC halving event putting significant pressure on the company’s revenues.

Bitcoin Mining Stocks Show Undervaluation

So far in 2024, some of the top BTC mining stocks such as Marathon Digital (NASDAQ: MARA), Riot Platforms (NASDAQ: RIOT), etc have been down 30-50% since the beginning of the year.

Crypto analytics platform ecoinometrics said that Bitcoin miner stocks had a terrible start to the year 2024, starting with a rough beginning and followed by a missed opportunity in Q1 following the spot Bitcoin ETF launch. During the second quarter, the BTC price has largely remained range-bound leaving the mining stocks struggling to gain momentum.

However, if history repeats, Bitcoin mining stocks can outperform BTC during the next bull run. In comparison to the previous cycles, several BTC mining stocks remain undervalued as of now.

The Bitcoin miners’ stocks have suffered a lot this year.

A terrible start to the year was followed by a missed opportunity during the Bitcoin ETFs rally in February and March. Since then, Bitcoin has been stuck in a range.

This is disappointing, considering that during… pic.twitter.com/3nJ3GoVbaf

— ecoinometrics (@ecoinometrics) August 18, 2024

“If you believe Bitcoin miners are likely to behave similarly during Bitcoin’s next parabolic phase, it’s reasonable to conclude that most of them are clearly undervalued,” noted ecoinometrics.

Top Bitcoin mining players have been consolidating their operations following the halving event in April, by buying new equipment and gearing up for future operations. Last week Marathon Digital purchased 4,144 Bitcoins through its $300 million in convertible notes.

In the past, several players have been betting on MicroStrategy stock as a proxy for Bitcoin. This also led to the launch of a leverage MicroStrategy ETF MSTX last week which saw strong trading volumes.

BTC Consolidation Ending Soon?

Over the weekend, the Bitcoin price attempted a breakout above $60,000 but failed to breach the crucial resistance. At press time, Bitcoin is trading 1.36% down at $58,549 with a market cap of $1.115 trillion.

Popular analyst Rekt Capital stated that Bitcoin is just 125 days from the halving event. Historically, the Bitcoin parabolic rally begins after 160 days from BTC halving. Thus, the BTC price breakout might come a month later by September end.

#BTC

Bitcoin is ~125 days after the Halving

Bitcoin tends to breakout into the Parabolic Phase of the cycle some ~160 days after the Halving

If history repeats, Bitcoin could be just over a month away from breakout

That’s late September$BTC #Crypto #Bitcoin pic.twitter.com/iy7xmDjuso

— Rekt Capital (@rektcapital) August 18, 2024

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Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.