Crypto-related stocks opened Wednesday’s US session with big gains in the form of Bitcoin surged above $72,000 for the first time in almost a month.
Crypto exchange Coinbase (COIN) surged above $200 to its highest price since late January, up 12% in the first minutes of trading. Strategy (MSTR), the largest corporate bitcoin holder, rose nearly 9% to a one-month high.
Galaxy Digital (GLXY), Robinhood (HOOD) and Ethereum treasury company BitMine (BMNR) rose 6-8%. Stablecoin issuer Circle (CRCL) soared another 6%, now up more than 70% in the week since its fourth-quarter earnings report.
Bitcoin miners, increasingly tied to building artificial intelligence data centers, also rebounded after Tuesday’s selloff. Bitfarms (BITF), Hive (HIVE), Hut 8 (HUT), and IREN saw gains of 6-10%.
The broader U.S. stock market also saw gains, with the Nasdaq and S&P 500 each up about 1% in early action.
The strong initial performance came as Bitcoin surged to $72,600 at the start of the US session, its highest price since early February. Recently, it pared some of the gains and pulled back to $71,500, still up about 5% in the last 24 hours.
The $70,000 to $72,000 range, which has capped previous rally attempts over the past month, is a crucial area that Bitcoin must overcome if this rally is to last.
Bitcoin’s outperformance versus stocks comes after crypto assets massively underperformed any other asset class over the past two months, which could explain why they are now diverging, according to Wintermute OTC trader Jasper De Maere. Another factor could be that, unlike stocks, digital assets are not tied to supply chains, energy costs or other factors that appear to weigh on prices, he wrote in a note.
De Maere also argued that stocks and cryptocurrencies have become “substitute risk assets.” With uncertainty slowing inflows into stocks, capital may instead turn to digital assets. “Uncertainty slows down inflows into stocks, which creates opportunities for crypto, and that’s what we’re seeing now,” he said. He nevertheless warned that this outperformance might not last. “The situation is fluid,” and a chain reaction of longer tensions leading to higher energy prices, persistent inflation, which could reduce the chances of a further rate cut, would be negative for crypto.
For now, he expects volatility to persist until there is more clarity.
