Bitcoin Edges Toward All-Time High, Lifting Coinbase, Square, Crypto Stocks

Posted by Andries Van Tonder on October 20, 2021 - 1:23pm

Bitcoin Edges Toward All-Time High, Lifting Coinbase, Square, Crypto Stocks

As Bitcoin nears an all-time high in price, cryptocurrency-related stocks like Square and Coinbase are also being pulled upwards.

Bitcoin’s current price of $63,900 is within touching distance of the flagship cryptocurrency’s all-time high of $64,804, and now it’s pulling Bitcoin-exposed stocks with it.

Crypto exchange Coinbase (COIN) and payments firm Square (SQ), for example, have both enjoyed hefty increases during the last week.

Coinbase stock has bumped from a share price of $248 to a current price of $305, representing a 22% increase over the previous week. Square stock—while not setting quite the same pace—has increased by 5% from a share price of $241 to today’s price of $254.

But that’s not all. According to Bloomberg, a total of 24 crypto-related stocks have soared by 91% this year alone.

The Bloomberg selected stocks have outperformed global equity sectors like energy, financials, and technology, which have increased this year by 40%, 24%, and 19%, respectively.

What’s causing the bump?

The latest Bitcoin price bump has been attributed to the United States’ first Bitcoin futures ETF.

Yesterday, the ProShares’ Bitcoin Strategy ETF began trading on the New York Stock Exchange (NYSE) under the ticker BITO after being approved by the U.S. Securities and Exchange Commission (SEC) last Friday.

Unlike a pure-play Bitcoin ETF, a futures ETF tracks the price of Bitcoin futures rather than the cryptocurrency.

The news has been met with wide-eyed optimism by Bitcoin’s supporters, as it means investors that want exposure to the flagship cryptocurrency can now buy shares tied to the future price of Bitcoin.

That excitement was also reflected in yesterday’s figures. A total of $994 million was traded, just $6 million shy of $1 billion. The only U.S. ETF to have ever traded $1 billion on its first day was Blackrock’s Carbon Transition Readiness ETF, which holds the record following its launch in April of this year.

“I thought if it traded $250 million in the first day, it would be a success. It did that in just 30 minutes,” said Bloomberg ETF research analyst James Seyfarrt.