The shares of Hut 8, Hive Blockchain, Riot Blockchain and Marathon Digital Holdings, some the largest crypto mining companies, experienced a spectacular 5,000% increase last year, while Bitcoin rose 900% over the past 12 months.
As reported by CNBC citing data from analyst firm Fundstrat Global Advisors, every 1% change in the price of Bitcoin converts into a 2.5% move in the same direction in the shares of mining companies. As a result, the shares of these companies would suffer greatly during bear markets, Fundstrat reports.
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Leeor Shimron, vice president at Fundstrat, has noted miners have recently made efforts to hold a certain amount of mined coins for the long term. For instance, Marathon Digital Holdings recently put $150M in Bitcoins.
The daily revenue of cryptocurrency miners has recently reached a record $52.3M. This means they have been able to increase their revenues in spite of the halving of the reward they receive for mining a block that took place in May last year.