It wasn't long ago that market players were desperately talking about a "crypto winter," with prices of digital coins and tokens trading sideways at best and falling at worst. Well, that cold season now seems like a distant memory; On Monday, once again, many cryptocurrencies and related assets rose again.
Altcoins did particularly well on the first trading day of the week. Bitcoin SV (BSV) and avalanche (AVAX 3.40%) Both are up about 9% since 4 pm ET on Friday. Crypto miners joined the business, although their profits were not as large. Riot platforms (RIOT 0.73%) closed on Monday almost 1% higher in price, while TeraWulf (WULF) experienced an increase of almost 2%.
Riot Platforms Earns Buy Recommendation From Analyst
There was little solid news moving prices for many of those altcoins and miners. One small exception is Riot Platforms, which got a vote of confidence when veteran financial services firm Bernstein initiated coverage of its stock with an Outperform (in other words, Buy) recommendation.
However, in the case of mining stocks, it is much more often the general dynamics of the cryptocurrency market that move prices, not the recommendations of forecasters. Still, the fresh burst of positive sentiment helped Riot Platforms and, by extension, comparable stocks in the segment.
Speaking of that dynamic, cryptocurrencies and related assets still have a lot of momentum behind them.
The cryptocurrency world continues to wait for any of the various proposed announcements bitcoin (btc 0.26%) exchange-traded funds (ETFs) to gain approval. Although there is already Crypto ETFs in the market, they tend to approximate the cryptocurrency market quite artificially. Spot ETFs in that asset class are considered truer representations of actual values.
They should gain instant popularity as they will allow investors to purchase cryptocurrencies without having to directly own such assets. Direct ownership can be daunting as there are many crypto โwalletsโ out there and not all of them are offered by trusted players. These also require care and management, hence the obvious appeal of a buy-it-and-go ETF investment.
Cryptocurrencies Could Be Approaching Overvalued Territory
Other developments outside the crypto universe are also raising sentiment around coins, tokens, and miners.
The geopolitical space continues to look relatively unstable, with a couple of armed conflicts waged by determined adversaries (at such times, many tend to put money into safe stores of value; more and more people are considering Bitcoin and some of the major cryptocurrencies). shelf cryptos are such assets). And safe assets don't look as pretty as they used to; The yield on the benchmark 10-year US Treasury bond has fallen recently.
With all this, investors should be concerned that the prices of digital money and related products are overheating. I don't foresee another crypto winter coming anytime soon, but some of those stocks look like balloons right now. Buyer beware.
Eric Volkman has positions in Bitcoin. The Motley Fool has positions and recommends Avalanche and Bitcoin. The Motley Fool has a disclosure policy.
