How Crypto Mining Stocks Have Performed In Comparison To Bitcoin

The impressive gains that proof-of-work (PoW) tokens, most especially Bitcoin, have recorded in recent days have brought mining firms into the spotlight, with many wondering how well the stocks have fared in comparison to Bitcoin on a year-to-date (YTD) basis. 

Top Crypto Mining Stocks Outperforming BTC

A first glance at the stocks of the most popular crypto-mining firms shows that the crypto-mining industry is also having a field day as they boast impressive YTD gains. For example, according to data from MarketWatch, the stock of the biggest Bitcoin miner by market cap, Riot Blockchain, has risen by over 185% year-to-date. 

This is more impressive when compared to Bitcoin itself, which is said to be one of the best-performing assets this year, with the crypto token seeing a gain of over 100% YTD. Interestingly, Riot’s stock isn’t the one that has recorded the most gains YTD among the top five crypto mining firms by market cap. 

According to data, the stock of the third-largest Bitcoin miner by market cap, Cipher Mining Inc., has recorded a gain of over 370% YTD. Marathon Digital Holdings, CleanSpark, and Hut 8 Mining, which make up the top five, have recorded gains of over 150%, 100%, and 140% respectively. 

The Relationship Between Bitcoin And These Mining Firms

Despite the stocks of these firms outperforming Bitcoin, there is no doubt that the crypto token indirectly contributes to investors’ interest in the crypto-mining companies, as many see it as an alternative to gain exposure to Bitcoin without directly investing in it. 

Like BTC, these firms have also come a long way from Q4 2022, the period the bear market peaked. Some of these firms, including Core Scientific and Compute North, had to file for bankruptcy protection, attributing the move partly to the market conditions then. 

Furthermore, as the Bitcoin Halving is fast approaching, there is the belief that these mining companies could once more experience some form of turbulence in their revenue. The Bitcoin Halving will see the rewards of miners being halved as a deflationary measure. Although it has always been a positive for BTC’s price, the same cannot be said for the mining industry. 

With this in mind, Miners are looking to diversify their operations in order to brace up for any negative impacts that the event and Bitcoin’s volatility might have on their businesses. One such diversification strategy happens to be miners using their mining operations to serve as data centers. Meanwhile, others are looking to incorporate Artificial Intelligence (AI) into their business model.

 BTC price marks new 2023 high | Source: BTCUSD on Tradingview.com

Featured image from CoinMarketCap, chart from Tradingview.com