Cryptocurrency-exposed stocks soared Thursday as Bitcoin smashed through another record.
Bitcoin topped $23,000 per token on Thursday, having only surpassed the $20,000 milestone for the first time on Wednesday. The digital currency is currently trading at around $23,153, according to a composite of prices compiled by Bloomberg.
Early Thursday stock gains included Marathon Patent Group Inc.’s rise of as much as 20%, lifting shares to the highest since March 2018. Bit Digital Inc. also climbed as much as 20%, Riot Blockchain Inc. added 10% and MicroStrategy Inc. rose 7.8%, while Silvergate Capital Corp., which was upgraded at at KBW, rallied 15% to a record. Cryptocurrency-linked stocks in Asia had jumped earlier, following gains for the U.S. names after Bitcoin’s rise on Wednesday.
PayPal Holdings Inc., which enabled customers to use cryptocurrencies in October, rose 3.2% to a fresh record high, and Square Inc., which put $50 million in Bitcoin on a crypto “empowerment bet” in October, climbed 3.4%, also to a new high.
The world’s largest digital currency has more than tripled in value this year and some observers predict more to come, arguing Bitcoin is increasingly seen as a portfolio diversifier at a time of dollar weakness and potential inflationary pressures.
“While a lot of skepticism still surrounds cryptocurrencies, some in the investment community appear to have warmed to them” and this is driving prices higher, said Michael Hewson, chief markets analyst at CMC Markets.
On Wednesday, Scott Minerd, Guggenheim Investments’s chief investment officer, said Bitcoin’s scarcity combined with “rampant money printing” by the Federal Reserve mean the digital token should eventually climb to about $400,000.
Last week, Massachusetts Mutual Life Insurance Co. invested $100 million in Bitcoin for its general investment fund, becoming the latest mainstream firm to dabble in the digit asset.