Betting against bitcoin has been a losing battle for months with the crypto up more than 200% since its March lows. Benefiting from this rally, moreover, cryptocurrency mining stocks trading on U.S. markets are significantly outperforming the benchmark cryptocurrency.

  • Over the past year, two cryptocurrency mining companies – Riot Blockchain and Marathon Patent Group – have gained 97% and over 128 percent, respectively. Bitcoin is up 3% in the same period.
  • The companies moderately underperformed bitcoin during the Q1 2020, but since mid-April, both took off.
  • The size of both companies mirror the relatively still small size of the crypto space, with neither company reporting a market capitalization above $150 million.
  • “Spillover from resurging interest in cryptocurrencies” is one reason for recent gains in mining stocks, according to Ryan Watkins, bitcoin analyst at Messari. “It’s natural for mining stocks to rise with cryptocurrencies,” he said.
riot-mara
Returns for Riot, Marathon and Bitcoin since August 2019
Source: Messari, Yahoo Finance
  • Riot and Marathon currently have mining capacities of 357 petahash and 19 petahash per second.
  • The companies' strong performance comes on the back of record trading volume.
  • Marathon daily volume soared to an all-time high of over $225 million on Aug. 3, up from $1.6 million a month earlier. Three days later, the company reached a two-year high of $5.25 per share.
  • After reporting less than $5 million for most of July, Riot daily volume also skyrocketed to a record-setting $58 million on Aug. 3 shortly before setting a new yearly high of $4.58.
  • “It’s also natural for mining stocks to rise faster than bitcoin because investors are pricing in a bull market, which could cause revenue to balloon,” Watkins added.
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