Coinbase, the top crypto exchange, is currently seeing a significant rise in its shares due to the ongoing Bitcoin rally. After a 62% surge in November, Coinbase’s shares have now jumped 2.5%, setting the company up for further growth in the coming months.
This rise in Coinbase’s shares is largely attributed to the unstoppable momentum of Bitcoin itself. Currently trading at an impressive $38,337 with a 1.6% increase, Bitcoin’s price surge has been fueled by various factors. Growing optimism surrounding the potential approval of a spot exchange-traded fund (ETF) and the resolution of uncertainties surrounding major player Binance have played a significant role in Bitcoin’s remarkable rise.
While Bitcoin takes the spotlight, J.P. Morgan, one of the world’s biggest investment banks, is also contributing to the boost in Bitcoin-related stocks. The bank recently raised its price targets on several prominent Bitcoin mining companies, including Cipher Mining, CleanSpark, Iris Energy, Marathon Digital, and Riot Platforms. As a result, these mining companies have seen gains ranging from 1.7% to 4%.
The profitability of Bitcoin miners has been steadily improving as the price of the cryptocurrency continues to climb. Mining companies are increasing production in anticipation of the upcoming “halving” event in the Bitcoin network, which happens about every four years. This event cuts the reward for mining new Bitcoin blocks in half, prompting miners to maximize profits before the event takes place next year.
However, it’s not just rising crypto prices and mining companies benefiting from the current market conditions. Coinbase’s positive performance is mirrored by other players in the crypto market. U.S. software developer and Bitcoin investor Microstrategy, for example, has seen its shares rise by nearly 3.5%. Additionally, ProShares Bitcoin Strategy ETF has gained 2.1% as investors bet on the potential approval of Bitcoin-related ETFs.
The positive momentum in crypto stocks is expected to continue into December, with Bitcoin reaching a near 19-month high. Shares of crypto miners and Bitcoin-tracking companies continue to rise, driven by optimism surrounding the potential approval of a spot ETF and the inevitable increase in money printing in 2024.
Despite the market’s positive sentiment, there are lingering concerns. The recent resignation and guilty plea of Binance CEO Changpeng Zhao for violating U.S. anti-money laundering laws have raised regulatory concerns within the industry. However, the overall positive momentum of the market seems to counter these worries, with ETF approval bets providing reassurance to investors.
In conclusion, Coinbase’s shares are experiencing significant growth as the Bitcoin rally remains strong. The surge in Bitcoin’s price, along with expectations of increased transaction volume and revenues, has propelled Coinbase’s share price to new heights. As we enter December, investors eagerly await the potential approval of Bitcoin-related ETFs and the continued growth of the crypto market.
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