By
Chimamanda U. Martha
April 26th, 2024
Marathon Digital’s spectacular performance aligns with the broader boom in the Bitcoin mining sector.
In an astonishing turn of events, Bitcoin (BTC) mining stocks experienced an unparalleled jump in trading volumes this week, outperforming some of the world’s greatest tech giants. Marathon Digital Holdings Inc (NASDAQ: MARA) and Riot Platforms Inc (NASDAQ: RIOT), two major players in the Bitcoin mining sector, collectively recorded a staggering $3.55 billion in trading volume on Monday, according to data from Yahoo Finance.
Marathon Digital Takes the Lead
Marathon Digital stole the spotlight by securing the position of the top-traded stock in the United States on Monday. With a trading volume of 112 million total shares, the Bitcoin miner surpassed well-known names such as Tesla Inc (NASDAQ: TSLA), Advanced Micro Devices, Inc (NASDAQ: AMD), Nvidia Corp (NASDAQ: NVDA), and Apple Inc (NASDAQ: AAPL) by a considerable margin. Even Tesla, the second most traded stock in the United States lagged behind with a daily trading volume of approximately 85 million shares.
Simultaneously, Grayscale’s Bitcoin Trust (GBTC) traded close to half a billion on the same day. Industry expert Eric Balchunas pointed out that this volume surpassed over 99% of the 3,000 current Exchange-Traded Funds (ETFs). Notably, Grayscale Investments, the firm behind GBTC, is seeking approval from the Securities and Exchange Commission (SEC) to convert this trust into a spot ETF.
As the market eagerly anticipates the potential approval of spot Bitcoin ETFs, Balchunas noted that GBTC is wielding a remarkable advantage, describing it as “bringing a (volume) gun to a knife fight.” He, however, emphasized that Grayscale’s 1.5% fee will act as a repellent to investors. As a reference, fees from BlackRock Inc (NYSE: BLK) are pegged at 0.30% with many wondering how Grayscale Investments will match up with this competition.
Bitcoin Mining Sector Boom
Marathon Digital’s spectacular performance aligns with the broader boom in the Bitcoin mining sector. On Monday, Core Scientific secured a $55 million equity investment, marking a successful emergence from its debt crisis.
The oversubscribed equity offering positions the company for relisting on the Nasdaq exchange after completing bankruptcy proceedings. Similarly, CleanSpark announced a strategic agreement that could see the acquisition of up to 160,000 miners by the end of 2024, further contributing to the sector’s upward trajectory.
Moreover, Marathon Digital recently disclosed that it mined a whopping 1,853 Bitcoin in December 2023. Marathon’s mining results from last month indicate that it increased production by 56% in just one month. In addition, the company’s production increased by 290% from December 2022 levels.
The extraordinary trading volumes witnessed by Bitcoin mining stocks on January 8 underscore the growing influence of the crypto mining industry. As Marathon Digital and other key players outpace established tech giants, the narrative around Bitcoin continues to evolve.
With the anticipation of spot Bitcoin ETF approvals and ongoing developments within the mining sector, the stage is set for further excitement and exploration of the dynamic intersection between traditional finance and the crypto space.
