Bitcoin Mining Stocks Decline Amid Market Trends

Shares of prominent publicly traded Bitcoin mining companies have dropped amid a broader market decline, even after the U.S. Securities and Exchange Commission (SEC) clarified that mining operations “do not involve the offer and sale of securities.”

Companies Impacted

MARA (MARA), CleanSpark (CLSK), and Bitdeer (BTDR) are among the mining companies experiencing losses so far this Friday, although there has been some rebound compared to earlier in the morning. Riot Platforms (RIOT) is relatively flat after dropping earlier in the day.

As of this writing, both MARA and BTDR have declined about 1.5%, while CLSK has fallen by 4.5%. None of them showed significant recovery after the SEC’s guidance circulated on Thursday afternoon, and they are currently underperforming relative to leading indices like the Nasdaq Composite and S&P 500, down 0.03% and 0.4% respectively as of this writing.

Broader Crypto Market Impact

Other major publicly traded crypto firms are also experiencing declines. Leading American crypto exchange Coinbase (COIN) has dipped 1.4%, and top Bitcoin treasury reserve firm Strategy (MSTR) has fallen 1% so far this Friday.

Consensus mechanisms such as proof-of-stake (PoS) or proof-of-work (PoW)—ways in which many major blockchains secure their networks and verify transactions—have drawn criticism from the SEC in the past. Notably, in 2022, former SEC Chairman Gary Gensler suggested that proof-of-stake assets like Ethereum or Solana could be classified as securities.

Thursday’s guidance, specifically addressing the proof-of-work consensus mechanism, did not boost the prices of the top mined assets like Bitcoin or Dogecoin, which are down 0.1% and 1.1% in the last 24 hours, respectively.

Ongoing Trends

This recent slide continues a troubling trend for publicly traded Bitcoin miners, who recently reported a loss of over $23 billion in collective market cap in just a month, according to a JP Morgan report.

The SEC’s latest mining guidance adds to a series of crypto-positive headlines associated with the Commission, including several dropped investigations and lawsuits focused on notable companies like Coinbase and Ripple.

Edited by Andrew Hayward