Bitcoin (BTC) has catapulted past the $60,000 mark for the first time since November 2021, propelled by a sustained influx of investments into exchange-traded funds (ETFs). The last two days alone witnessed a combined net inflow of $1.1 billion into ETFs, with demand from Bitcoin ETFs surpassing daily Bitcoin production by miners by approximately tenfold.
Amid this bullish momentum, analysts at Bernstein have highlighted a notable trend – the underperformance of Bitcoin mining stocks relative to the cryptocurrency’s surge. Over the past 120 days, particularly since the heightened probability of ETF approvals and the actual launch of ETFs on January 10, Bitcoin mining companies, such as Cleanspark (NASDAQ:CLSK) and Marathon Digital (NASDAQ:MARA), recorded remarkable gains of around 380% and 250%, respectively. This outpaced the 70% increase in BTC’s price during the same period.
However, this pattern did not persist as Bitcoin surged above $60,000 on Wednesday. On that day, the flagship cryptocurrency experienced a 6% rise, overshadowing miners like Riot Platforms (NASDAQ:RIOT) and CLSK, which fell by 7.5% and 10%, respectively.
Analysts attribute this shift to Bitcoin’s violent rallies, explaining that they tend to absorb liquidity from mining stocks. “Retail traders end up chasing Bitcoin on days like today, versus mining stocks,” they noted. Despite the short-term divergence, analysts expect Bitcoin miners to exhibit higher beta over a reasonable timeframe, such as a micro BTC cycle – encompassing the pre-ETF rally, post-ETF rally, or the entire BTC cycle, which typically spans 18-24 months. They emphasize that this higher beta is not a daily occurrence but unfolds over a more extended period.
