Crypto Miners Had an Incredible Day Yesterday

Bitcoin and Ethereum surged, with bitcoin approaching record highs and Ethereum’s token, ether, reaching a new high water mark of $4,816.60.

In yesterday’s rally, Marathan Digital went up 20%, Riot Blockchain leaped 17%, MicroStrategy was up 9%, Coinbase climbed 7%, and Hive and Hut 8 both increased by 5%.

One thing all of these firms have in common is that they are all holdings in the VanEck Digital Transformation ETF (DAPP). As crypto continues to normalize, firms that deal in the digital infrastructure of the space will continue to grow. Profitability in mining is extremely high right now. In a presentation back in September, Marathon noted that its mining costs, when all rigs are deployed, comes to about $5,612 per bitcoin. That translates to an impressive margin of 85%.

Coinbase’s weekly email on Friday said, “The inflation narrative still dominates the headlines and people are feeling the pinch globally. Whether it’s gas prices in the U.S., energy prices in Europe or food prices in Latin America, the headwinds of supply chain constraints and a shrinking labor force has investors looking for a store of value.”

Eddie Wang, a senior analyst at OKLink research, noted that the network’s hashrate has been steadily increasing since July, indicating positive bullish signs for cryptocurrency in the medium term. The number of unique wallets with non-zero balances has also returned to 39 million, close to its May high.

Daniel Kukan, a senior cryptocurrency trader at Crypto Finance AG, noted that bitcoin’s performance over the past couple of weeks was a solid indication of a bull market pause. “It was a healthy consolidation and the market has not tested the short term support of $58,000, which is a strong signal. I can see some interest to sell at slightly above $70,000, [but I] guess we are going to take out that level rather fast.”

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