You should buy mining stocks before Bitcoin goes up: Bernstein | CoinDesk JAPAN

Shares of Bitcoin (BTC) mining companies have underperformed their average in recent weeks, but short-term weakness could present a buying opportunity. The investment firm Bernstein pointed out this in a research report on the 15th.

Mining stocks face two headwinds following the approval of a physical Bitcoin exchange-traded fund. The report points out that the first is a decline in investors’ willingness to use mining stocks as a proxy, and the second is the decline in Bitcoin prices, which has led to further declines in performance.

The Valkyrie Bitcoin Miners ETF (WGMI), which invests in stocks of publicly traded Bitcoin mining companies, has fallen nearly 38% this year. Meanwhile, Bitcoin prices and the broader stock market were nearly flat.

However, this poor performance may present an opportunity for investors looking for opportunities to buy mining stocks. Analysts Gautam Chhugani and Mahika Sapra said, “As with Bitcoin, the next two months will be a buying opportunity for Bitcoin mining stocks.” will provide “higher beta trading” towards the inflection point in Bitcoin’s price.

The report assumes that Bitcoin could temporarily fall further, with a near-term bottom in the range of $38,000 to $42,000. Still, investors should be “structurally long” ahead of the next halving, expected in April.

Bernstein reiterated his bullish view on mining companies in a separate document on the 17th. Bernstein said, “Bitcoin mining companies offer a higher beta than Bitcoin, driven by EBITDA (earnings before interest, taxes, depreciation and amortization) expansion and the market’s prolific growth towards a bullish cycle. “Gain exposure to coins.” He also says he favors highly rated stocks such as Riot Platforms and CleanSpark.

｜Translation and editing: Rinan Hayashi
｜Image: Unsplash
｜Original text: Bernstein Says Buy the Dip in Bitcoin Mining Stocks Ahead of BTC Price ‘Inflection’