Crypto Stocks to Benefit as BTC Rallies

Crypto stocks have done well this year, with most of them beating the broader market. Coinbase (COIN) stock has risen by over 34%, as cryptocurrency prices soared and as it became the market leader in the crypto custody industry.

Crypto stocks have done well this year, with most of them beating the broader market. Coinbase (NASDAQ:COIN) stock has risen by over 34%, as cryptocurrency prices soared and as it became the market leader in the crypto custody industry.

Crypto stocks to benefit as BTC rallies

Bitcoin mining stocks like Core Scientific (NASDAQ:CORZ), Riot Platforms (NASDAQ:RIOT), Bitfarms (NASDAQ:BITF), and Marathon Digital (NASDAQ:MARA) have also risen this year. These companies do well when Bitcoin is rising because they are some of its biggest holdings. Data shows that Marathon Digital golds over 20,000 coins while Riot and Hut 8 Mining have slightly under 10,000 coins.

The best-performing Bitcoin stock this year has been MicroStrategy (NASDAQ:MSTR), a company that holds over 226,000 coins. Its stock has soared by over 166%, giving it a market cap of over $30 billion compared to its Bitcoin holdings valued at less than $16 billion. MSTR has become a better holding than spot ETFs.

These crypto stocks have more catalysts that could push them higher for longer in the longer term.

First, Bitcoin demand and supply are moving in the different directions. Demand is rising from the likes of ETFs while supply is slowing because of halving. There are signs that this demand will continue rising now that Trump has hinted that the government will accumulate and store Bitcoin as a reserve asset. Such a move will push more countries to do the same.

Second, analysts are upbeat on the price of Bitcoin. Michael Saylor noted that Bitcoin price could surge to over $49 million in the next 21 years. Larry Fink, Blackrock’s CEO, has become a Bitcoin believer while VanEck believes that the coin could vault to $52 million by 2050. Jen VanEck has allocated 30% of his net worth to Bitcoin.

Third, Bitcoin has formed the extremely bullish cup and handle chart pattern on the weekly chart. In most cases, this pattern usually leads to a big breakout over time. The cup section, as shown above, is in red while the recent consolidation is part of the handle section.

This pattern has been supported by the 50-day Exponential Moving Average (EMA), where Bitcoin failed to move below in July.

At the same time, the handle section is also a falling broadening wedge chart pattern, which is another bullish sign. Therefore, ultimately, if this pattern works well, there are chances that it will have a bullish breakout.

A good example of the cup and handle pattern in action is to look at gold’s monthly chart. As shown above, gold formed a cup section between September 2011 and July 2020. It then formed the handle part between August 2020 and October 2023. Most recently, it has formed a bullish breakout, pushing it to a record high of near $2,500.

Looking ahead, most of these crypto stocks will be impacted by the upcoming earnings that starts on Tuesday. Some of the companies to watch this week will be Coinbase, MicroStrategy, Riot Platforms, and Marathon Digital.