Cryptocurrency stocks surge as Bitcoin hits fresh 2023 high

Digital currency continues to be an alluring and growing global trend. Photo: Pete Linforth/Pixabay

Digital currency continues to be an alluring and growing global trend. Photo: Pete Linforth/Pixabay

Published Dec 5, 2023


Cryptocurrency-related stocks listed in the US surged yesterday, looking to extend their strong November gains, as bitcoin topped $42 000 (about R788 000) to hit a fresh high for the year.

The world's biggest cryptocurrency, Bitcoin climbed 4% to $41 598 – its highest point since April 2022 – riding a wave of enthusiasm about potential interest rate cuts in the US as well as traders betting on the imminent approval of US stock market-traded bitcoin funds.

The cryptocurrency hit a session high of $42 162.

“The impact of an (ETF) approval is going to be big in terms of investment appetite because it's going to be more easily regulated, more attractive and easier to invest,” said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.

“What we have right now is a risk rally, and bitcoin is also benefiting big time by falling yields. There is also this positive bullish sentiment into next year because it is going to be the year of halving.”

Halving is a process designed to slow the release of bitcoin, and bitcoin prices have typically rallied following halvings.

Coinbase jumped 7.3% before the bell. The stock rose nearly 62% in November, even as the crypto exchange reported a decline in third-quarter trading volumes.

Bitcoin investor Microstrategy, which bought bitcoins worth $593 million last month, gained 8.2%.

Bitcoin miners such as Riot Platforms, Marathon Digital and CleanSpark jumped between 9.7% and 12%, respectively, adding to their double-digit gains in November.

The ProShares Bitcoin Strategy ETF, which tracks bitcoin futures, rose 7.4% and looked set to touch an over one-year high, while the ProShares Short Bitcoin Strategy ETF that allows traders to bet on a fall in bitcoin futures fell 7.2%.

Investor sentiment towards cryptocurrencies and related assets had been lukewarm earlier this year after a string of high-profile collapses in 2022 led to outflows of more than $1 trillion from the sector.

However, the recent rally has sent bitcoin up more than 150% so far in 2023, on course for its best annual performance since 2020.