Altcoins
Why Altcoins and Crypto Mining Stocks Were on Fire Today
On Valentine’s Day, investors expressed their love for all things crypto by trading – substantially, in many cases – the prices of digital coins and tokens, as well as securities of companies associated with the digital currency.
Leading Altcoin Ethereum (CRYPTO:ETH) was a beneficiary, as it was sailing up 5.4% in late afternoon trading. Although this gain is impressive, it did not stand up to the crypto mining equipment specialist. Canaan (NASDAQ: CAN), whose American Depositary Receipts (ADRs) closed the day up nearly 32%. Behind Canaan, minor TeraWulf (NASDAQ: WULF) rose more than 12%.
The Bitcoin effect
Bitcoin (CRYPTO: BTC) is the world’s first cryptocurrency and, eighteen years after its introduction, it remains by far the most influential. When things go well, more often than not, other coins and tokens, as well as cryptocurrency mining companies, tend to follow suit.
Fortunately for the holders of these assets, Bitcoin was remarkable on Wednesday. After a slight decline on Tuesday, it crossed the $50,000 mark again, settling comfortably at just under $52,000 at the end of the day. The flow of investment in Spot Bitcoin exchange-traded funds (ETFs) has shown no signs of ebbing, and what is good for these stocks is good for their fundamental assets.
Other factors keep the buying fire alive. On Wednesday morning, online crypto news site Coindesk.com reported that European Union (EU) officials had drafted and released a document on an upcoming meeting of the EU’s financial services committee. This event, scheduled for April, will focus on the regulation of cryptocurrencies in the 27-country economic bloc.
According to Coindesk, the document outlines the discussion points for the meeting. These include topics such as licensing and implementation of the recently enacted set of laws in crypto asset markets. The most intriguing thing is that there is talk of a digital euro; it would likely be the “official” EU-wide cryptocurrency.
A touch of optimism
The EU document is just the latest in a series of indications that top regulators around the world are not only taking cryptos seriously, but also accepting that these assets are part of the fabric of their economies. As these assets become more accepted and entrenched, we may also see markets like Europe adopting the latest innovations in crypto.
Which brings us to a question: are spot crypto ETFs about to start being developed overseas as well?
I think it’s more than likely. There is curiosity and hunger for crypto around the world, but a major stumbling block remains the software and technology know-how required to simply transact in coins and tokens. In one fell swoop, spot ETFs remove this requirement because they are securities that are easily traded on an exchange. We are only at the beginning of the spot crypto ETF revolution.
The story continues
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Eric Volkman has positions in Bitcoin and Ethereum. The Motley Fool posts and recommends Bitcoin and Ethereum. The Mad Motley has a disclosure policy.
Why Altcoins and Crypto Mining Stocks Were on Fire Today was originally published by The Motley Fool