Bitcoin-linked stocks are crashing, signaling crypto's fading allure
Stocks of companies holding lots of bitcoin have dropped sharply in 2024, mirroring the slowdown in crypto excitement.
Big players like MicroStrategy and Metaplanet—who buy bitcoin by issuing shares or debt—are feeling the sting as investor mood shifts.
MicroStrategy's stock price fell from $457 to $328
If you're watching the crypto space, these stock swings show just how risky it can be when companies tie themselves closely to bitcoin.
Even with MicroStrategy, its share price slid from $457 in July to $328 by September [2024].
Metaplanet's shares fell over 60% from their June highs.
Smaller firms like Smarter Web and Alt5 Sigma saw similar drops, highlighting the dangers of leveraged bets on digital coins.
Retail investors panic-selling makes things worse
These stocks are even more volatile than bitcoin itself—sometimes moving four to five times more than bitcoin's own price changes.
Analyst Adam McCarthy notes that retail investors panic-selling only makes things worse.
Plus, when companies raise money by issuing more shares, it dilutes existing shareholders and adds extra pressure.
Companies deeply invested in digital assets are facing turbulence
Firms branching into other cryptocurrencies aren't immune either.
Companies like BitMine and GameSquare, after announcing plans to buy ether, have seen their share prices tumble nearly 67% since July.
All told, there's a clear cooling-off in crypto-linked stocks—and plenty of turbulence for any company deeply invested in digital assets right now.