| Crypto Mining Stocks with the Best Performance | |||
|---|---|---|---|
| Price ($) | Market Cap ($M) | 12-Month Trailing Total Return (%) | |
| Canaan Inc. (CAN) | 3.25 | 557.4 | -62.5 |
| Marathon Digital Holdings Inc. (MARA) | 12.82 | 1,498 | -64.0 |
| HIVE Blockchain Technologies Ltd. (HIVE) | 4.55 | 374.2 | -70.3 |
| S&P 500 | N/A | N/A | -10.7 |
| Amplify Transformational Data Sharing ETF (BLOK) | N/A | N/A | -51.5 |
Source: YCharts
- Canaan Inc.: See above for company description.
- Marathon Digital Holdings Inc.: Marathon Digital Holdings is a digital asset technology company engaged in the mining ofcryptocurrencies. Its primary focus is on theblockchainecosystem and generating digital assets. On Aug. 8, Marathon reported Q2 2022 earnings results. It net loss widened considerably YOY as revenue declined by about 15%. Results were impacted by factors including the decline in the price of bitcoin, and maintenance and weather issues.
- HIVE Blockchain Technologies Ltd.: See above for company description.
Analyzing Crypto Stocks
If you are planning to invest in crypto mining stocks and other related companies, it's important to have a sense of the underlying cryptocurrency market. Investing in cryptocurrencies requires an understanding of what data to look for on a technical analysis crypto chart. There are a few basic parameters to consider when assessing the performance of a cryptocurrency.
Price: Checking the price of a cryptocurrency is the first step in checking its performance. Comparing price movements with past days, weeks, months, years, and all times are some of the tools necessary to understand before investing.
Market cap: Themarket capitalizationof a cryptocurrency is calculated by multiplying the price of each token by the number of circulating coins. A comparison can be made with the data over the past few days, weeks, and years.
Trading volume: This refers to the number of times that a coin changes hands during a certain period of time. If it's expanding, that means more and more people are buying the coin.
Hashrate: This is the speed of mining a cryptocurrency. In other words, it measures how many calculations can be completed in a second in units ofhash/second. It's a good sign if the hashrate is higher because that means a large number of miners are verifying transactions, and hence the cryptocurrency is more secure.
Circulation supply: In general, circulation supply refers to the number of coins or tokens that are actively traded and used in the market and by people. The price of coins willdepreciateif the supply is high and the demand is low.
Risks of Crypto Stocks
Due to high volatility, the cryptocurrency market carries a certain level of risk, and price swings are common. Before you start investing in crypto, you should outline your appetite for risk and implement a solid risk management strategy.
While cryptocurrencies are risky, they also have the potential to offer outsized returns. When Bitcoin began in 2009, the digital currency essentially had very little value. In the years that followed, it jumped to a fraction of a penny and then eventually to tens of thousands of dollars. Gains like these might be among the most significant benefits of investing in cryptocurrency.
In addition, the cryptocurrency market is currently dominated byspeculative trading. Studies of blockchain activity show that exchange trades remain the mostprevalentuse for cryptocurrencies—and account for far more economic activity than ordinary trades and purchases. Cryptocurrency skeptics, including Warren Buffett, Bill Gates, and JPMorgan CEO Jamie Dimon, have all warned of a potential cryptobubble. Cryptocurrencies are not unique in being subject to speculative manias andirrational exuberance, but that's another risk to consider.
As a new technology, some speculative behavior is to be expected, especially as blockchain technology matures. However, new investors should be wary of falling into fraudulent situations or psychological traps such asherd instinct,fear of missing out, or thegreater fool fallacy, which can make all the difference between a calculated risk and a foolish one.
The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. Though we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.
