Crypto-linked stocks plummet amid massive sell-offs in bitcoin and ethereum

Bitcoin Bubble
  • Bitcoin and ethereum both fell double digits on Wednesday before a recovery in a dark day for the crypto world.
  • Crypto-linked stocks like Coinbase, Riot Blockchain, MicroStrategy, and more all fell in response.
  • The start of the bear market for crypto came after Elon Musk said Tesla would no longer accept bitcoin on May 12.
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Cryptocurrency linked-stocks plummeted on Wednesday amid massive sell-offs in crypto leaders bitcoin and ethereum.

Shares of the cryptocurrency exchange, Coinbase, fell as much as 10%, while shares of cryptocurrency miners like Riot Blockchain and Marathon Digital Holdings were down as much as 17% and 18%, respectively.

Michael Saylor’s Microstrategy, which just “bought the dip” in bitcoin with $10 million at an average price of $43,663 per coin, was down as much as 15% on the day.

Grayscale Bitcoin Trust sank more than 6% on Wednesday as well, and even Tesla saw its stock drop more than 3% on the dark day for cryptocurrency enthusiasts.

Cryptocurrencies as a whole saw roughly 15% wiped off their total market cap on the day, according to data from, as altcoins fell in tandem with crypto leaders bitcoin and ethereum.

All of the top ten cryptocurrencies by market cap, except the stablecoins, fell double digits on Wednesday.

The cryptocurrency bear market began on May 12, when Elon Musk tweeted that Tesla would no longer accept bitcoin as a payment method due to the environmental impact of its computational mining tactic for minting new coins.

Then on Tuesday, the Chinese government reinforced its previous ban on financial institutions and payments companies operating in the cryptocurrency business.

The National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China said in a statement that cryptocurrencies “are not supported by real value” and argued speculative trading of cryptocurrencies is “seriously infringing on the safety of people’s property and disrupting the normal economic and financial order.”

The historic single-day fall for cryptocurrencies comes just a day after Galaxy Digital’s Mike Novogratz shrugged off the recent crypto-slump.

“It’s easy to get buried in the volatility of the day,” Novogratz said, according to a transcript on Sentieo, a financial-research site. “Elon Musk’s Twitter comments, bitcoin going down 4,000 points, and everyone starts running around like chickens with their head cut off.”

Novogratz said he expects the total value of crypto assets to triple, or even quadruple, to between $6 trillion and $8 trillion in the coming years.

Read more: ‘Wolf of All Streets’ crypto trader Scott Melker breaks down his strategy for making money using ‘HODLing’ and 100X trade opportunities – and shares 5 under-the-radar tokens he thinks could explode

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Bitcoin-exposed stocks slide alongside the cryptocurrency as Elon Musk once again wreaks havoc with a tweet

Elon Musk
Tesla CEO Elon Musk

  • Cryptic social-media behavior from Elon Musk suggesting Tesla may have dumped its bitcoin holdings pushed lower stocks linked to the cryptocurrency.
  • Musk later clarified however that he has not sold any.
  • Bitcoin has rebounded after its lowest plunge since February but is still in negative territory.
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Companies exposed to bitcoin slid on Monday in the wake of the cryptocurrency plunging to its lowest level since February after Elon Musk suggested Tesla might have sold its holdings over the weekend.

Bitcoin tumbled to $42,185 on Monday morning, several hours after Musk replied “Indeed” to a Twitter post saying: “Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their #Bitcoin holdings.”

The price of the cryptocurrency climbed somewhat when the billionaire clarified that Tesla still holds its stake.

Bitcoin traded lower by 7.9% to $45,064.723 as of 10 a.m. in New York.

Here is where shares of bitcoin-linked stocks stood on Monday morning:

Elon Musk’s May 13 reversal on allowing Tesla to accept bitcoin as payment sent shockwaves across the digital asset ecosystem.

Wedbush’s Dan Ives in a note said the move was “very surprising and confusing,” not only to cryptocurrency enthusiasts but to Tesla shareholders as well.

Musk’s Twitter announcement saying Tesla has suspended vehicle purchases using bitcoin just came three months after the company invested billions in the cryptocurrency and accept it as payment for its electric cars.

Read more: UBS says to buy these 42 ‘new momentum’ stocks that are poised to outperform in a rising inflation environment

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Riot Blockchain jumps 25% as bitcoin momentum continues and the company notches new mining milestone

Bitcoin invest2

Riot Blockchain’s stock jumped as much as 25% on Thursday after the company hit a new milestone in its crypto mining operations amid a surge in bitcoin prices.

The company announced it achieved a 1.06 Exahash per second (EH/s) mining rate with 2,002 new S19 Pro Antminers from Bitmain.

Riot now has a total of 11,542 Antminers in operation after the new additions, leading to a nearly 26% increase in production over its prior operational hash rate.

“Exceeding 1 EH/s in hash rate capacity marks a major milestone for the Company,” said Jason Les, CEO of Riot Blockchain.  “While we are proud of this accomplishment, we view it as the successful completion of just one of many steps of our ongoing growth plan.”

Read more: A Ruffer portfolio manager invested a portion of his $4.8 billion fund in Bitcoin. Here’s what swayed him to bet on crypto – and the 2 other ways he’s hedging against worrying speculative bubbles

Jason Les came on as CEO on Monday, replacing Jeff McGonegal who has served as Riot’s CFO since 2003.

The newly minted CEO said he expects to more than triple the company’s mining capacity by the fourth quarter this year. Riot has 26,100 S19 Pro and S19j Antminers on order with Bitmain and expects to have a total of 37,642 miners in operation by the end of the year.

The bullish news from Riot comes as Bitcoin’s price pushed above $48,000 per coin on Thursday for only the second time in its history. The jump came after Mastercard and BNY Mellon announced support for the cryptocurrency on Thursday. Elon Musk also tweeted about bitcoin in a post that received well over 100,000 likes.

Bitcoin always has vocal critics, though. On Wednesday “Dr. Doom” economist Nouriel Roubini argued Bitcoin’s fundamental value is negative due to its environmental impact.

A study out of Harvard backed up Roubini’s claims, revealing there is “a scenario where each $1 of cryptocurrency coin value created would be responsible for $0.66 in health and climate damages.”

Read More: UBS says bitcoin is a bubble and too volatile to diversify a portfolio, unlike gold – here’s why the bank says it could end up ‘worthless’

Still, that hasn’t stopped investors from scooping up shares in the bitcoin miner. Share prices have risen 95% in the last month alone.

Even California’s state pension fund-California Public Employees’ Retirement System (CalPERS)-believes in Riot. The fund now holds 113,034 shares of the miner, according to SEC filings.

Riot traded up 24.95%, at $45.68, as of 3:33 p.m. EST on Thursday.

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