The upcoming IPO debut of two hydro powered renewable energy crypto mining companies on Nasdaq could turn out to be good news for those bullish on crypto and the overall market, especially as Bitcoin struggles to recover. Bitcoin has been facing criticism from regulators and market makers like Tesla CEO Elon Musk due to its increasing use of fossil fuels.
The 50-day moving average and 200-day moving average recently formed a pattern called the “death cross,” a lagging indicator that Bitcoin’s price could move in either direction. The last time a death cross pattern was formed was March 2020, and the market pushed the de-facto crypto leader price to an all-time high of $64,000.
An Optimistic Sign for the Crypto Market
The Nasdaq stock exchange approved Canada based Hive Blockchain Technologies to list shares. Currently, Hive is trading on the TSX Venture Exchange. The company focuses on Bitcoin and Ethereum mining and its main strategy is to stick to clean energy for mining.
“HIVE owns state-of-the-art green energy-powered data center facilities in Canada, Sweden and Iceland, which produce newly minted digital currencies like Bitcoin and Ethereum continuously on the cloud,” Hive’s announcement says. “Since the beginning of 2021, HIVE has accumulated the majority of its ETH and BTC coin production, which we hold in secure storage.”
The other company is a Toronto-based Bitcoin mining firm called Bitfarms, which says its goal is to become the largest publicly traded North American Bitcoin miner that uses close to 100% hydroelectric energy. Bitfarms listed on Nasdaq on June 21 under the symbol “BITF.”
“We started this company four years ago with a clear belief in the institutional adoption of Bitcoin and Bitcoin mining,” Bitfarms CEO Emiliano Grodzki said.
Hive Blockchain Technologies and Bitfarms joins the list of other bitcoin mining companies on Nasdaq, which includes Riot Blockchain and Marathon Digital Holdings.
Hive and Bitfarms Listings Will Increase Investors Exposure to Crypto Markets
Due to various regulatory bodies, it has been challenging for crypto mining companies to enter major capital markets. But the listings of Hive and Bitfarms will help further open alternative asset investment opportunities for investors.
The two listings come as the average return of shares of Bitcoin mining companies have outshined base assets’ returns by a wide margin, according to Fundstrat’s Vice President of Digital Asset Strategy Leeor Shimron. The researcher said the average return of the four largest publicly traded mining firms, Riot Blockchain, Marathon Digital Holdings, Hive Blockchain and Hut 8, was 5,000% in the last 12 months.
“Since the primary source of revenue is Bitcoin, these companies are fundamentally long [on] the industry — so investors are essentially making a ‘picks and shovels’ bet when they invest in miners,” Shimron said.
Despite the latest price collapse, shares of Canadian Hive soared in the last 12 months amid investors’ ballooning interest in the crypto markets. Its shares are trading around 3.00 CAD, representing a drop of 44% from an all-time high of 6.8 CAD in May. Meanwhile, Bitforms’ stock price also saw a stunning surge since the beginning of 2020, with its shares climbing from just 0.44 CAD to an all-time high of 8.06 CAD early this year. In the March quarter, the Toronto-based company generated $28.4 million in revenue and its adjusted EBITDA came in at $19.7 million.
Bitcoin Mining Council Debut Will Improve Mining Transparency
As energy consumption in the Bitcoin mining process comes under the spotlight, the formation of the bitcoin mining council could also be a positive move in educating people about mining procedures.
First suggested by Elon Musk in May, the council is composed of North American bitcoin miners and works to promote Bitcoin good practices, transparency and education.
MicroStrategy CEO Michael Saylor, who holds over 100,000 bitcoin, is among the founding members of the council.
Michael Saylor described the group’s role in a tweet: “The Bitcoin Mining Council is a voluntary and open forum of Bitcoin miners committed to the network and its core principles. We promote transparency, share best practices and educate the public on the benefits of #Bitcoin and Bitcoin mining.”
Other founding members include blockchain mining company Argo, investment management firm Galaxy Digital, Bitcoin mining company Riot and blockchain technology firm Hive.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.