That's a terrible idea in my opinion because your money depends heavily on what happens to that company. From the stupid decisions the owners make to the stupid regulations that may affect the company's future.
For example a while ago MARA pool decided to censor bitcoin transactions and announced it to the public, shortly after their stock got dumped.
Or there are other mining companies that have borrowed a lot of money in a country like US with increasing inflation and interest rates and they simply went under over the past year!
On top of all that we have bitcoin price being volatile itself. Which means the company is affected by it too.
That means it is wiser to just buy bitcoin where you only have to worry about its price instead of stocks of a company that is affected by a lot of things.
Topic: Which BTC/mining related stock seems most promising going forward? (Read 149 times)
February 24, 2023, 01:21:32 AM
February 23, 2023, 04:48:36 AM
Riot went from $10 In August of last year to $3 in December. Bitcoin to go this low would have to reach $3000.
Why add additional risk to your investment when you can clearly see these stocks don't even follow bitcoin's highs, but crash much harder every time bitcoin does?
Why add additional risk to your investment when you can clearly see these stocks don't even follow bitcoin's highs, but crash much harder every time bitcoin does?
That's not how it works.
You choose a peak point for one of them and then ignored the bitcoin price on the same dates.
Even by going by your scenario, August to date, you have
- riot from $10 to 6.5
- bitcoin at same price 24k
So no 3x difference, just a 33% loss on riot.
But if we choose other dates, for example, yoy
- you have riot at $15 down to $6.5
- you have bitcoin down from 41k to 24k
so a 35% loss for riot versus a 41% on BTC
Now let's go 3 years
- riot at $1.1 now 6.5
- bitcoin at $9k, not at 24k
With riot you have a 6x, with BTC you have nearly 3x.
Plus at no point in the last 3 years, you would have been able to take home a 100x revenue with BTC , you could have done that with Riot shares.
February 20, 2023, 07:00:14 AM
I'd suggest you buy graphic card manufacturer stock instead. Nvidia and AMD are definitely more valuable compared to mining companies. While you can argue that most of their price does not factor crypto as of now, judging from the past if there is a bull market or even a new coin that is minable with GPU, there is a chance that their revenue will increase and you can get more dividend, CMIIW. Obviously, this is just speculation, but imo it is arguably better than investing in a mining company stock that is way too volatile, and as others have mentioned, just buy Bitcoin if you don't want other alternatives.
If an exchange ever went public and sold its stock, maybe that is also a better option compared to a mining company. But I don't think they will ever do that since most of them sell their own tokens, and hold a ton of them so they can just dump to the market if they need more cash. At the end of the day, just buy Bitcoin to reduce any risk, don't gamble too much on crypto business stocks that are proven to be a terrible way to make money. CMIIW.
If an exchange ever went public and sold its stock, maybe that is also a better option compared to a mining company. But I don't think they will ever do that since most of them sell their own tokens, and hold a ton of them so they can just dump to the market if they need more cash. At the end of the day, just buy Bitcoin to reduce any risk, don't gamble too much on crypto business stocks that are proven to be a terrible way to make money. CMIIW.
February 19, 2023, 11:41:39 PM
I'm not a fan as mining-related companies can technically still go bust due to company mismanagement even if bitcoin is on an upward tear. The only single reason why I would personally buy a mining-related stock is if the stock is fundamentally significantly undervalued. But then, I'd immediately sell the stock once it gets mildly close to fair value.
February 19, 2023, 09:14:36 PM
I would like to have some exposure to BTC outside of just the crypto market, and I have invested in some of the mining stocks like RIOT and MARA, what is your take on these companies moving forward?
It is risky bro.Many Bitcoin mining companies and they can have bankruptcies like many business companies. Bitcoin mining companies must have good management to have profit and survive through bear markets and you don't know what they do to manage their company fund, risk from bank liquidation if they use leverage.
You can invest in Bitcoin and it's your key, it's your coin. Bitcoin will not be bankrupted but Bitcoin mining companies will have. Buying stocks from those companies, you don't have any key, don't have any coin and if they bankrupt, you will have empty hands.
Risk is not small as many reports give us information about high leverages from mining companies.
Bitcoin Mining Revenue In 2022 Dropped 37.5% To $9.55 Billion
Quote
According to the Hashrate Index, debt-to-equity ratios more than tripled for many miners, indicating greater financial leverage. As updated in an earlier Coincu News article, Core Scientific has the highest debt-to-equity ratio of 26.7, followed by Greenidge and Stronghold at 18 and 11.1, respectively. Argo also has a high debt-to-equity ratio of 8.7.
Riot Blockchain Bitcoin Mining Revenue Slashed by 25% in Q3 2022, Share Prices Crash
February 19, 2023, 08:45:16 PM
I am curious if a company is related to Bitcoin like Bitcoin mining, why buy Bitcoin instead? Because as far as I know, these kinds of the company seem also correlated with the price of Bitcoin. Just seems like a cryptocurrency exchange, best example is Coinbase stock, which seems also correlated with the price of Bitcoin.
February 19, 2023, 05:06:12 PM
Mining is very risky. These companies are highly leveraged. Their chances of success, or even survival, are low.
That's my take.
That's my take.
February 19, 2023, 02:55:16 PM
These stocks are much more manipulated than bitcoin. You risk your money by investing in them no less than you would risk it by gambling.
Canaan stock was at about $36 ATH and crashed to 18 in less than 2 weeks. Then it kept crashing and ignored Bitcoin's highs in October and November of 2021. If you bought that mining stock instead of bitcoin in 2021 you did much worse than you would if you chose bitcoin. The stock reached its lows in December last year of just $2.
Riot went from $10 In August of last year to $3 in December. Bitcoin to go this low would have to reach $3000.
Why add additional risk to your investment when you can clearly see these stocks don't even follow bitcoin's highs, but crash much harder every time bitcoin does?
Canaan stock was at about $36 ATH and crashed to 18 in less than 2 weeks. Then it kept crashing and ignored Bitcoin's highs in October and November of 2021. If you bought that mining stock instead of bitcoin in 2021 you did much worse than you would if you chose bitcoin. The stock reached its lows in December last year of just $2.
Riot went from $10 In August of last year to $3 in December. Bitcoin to go this low would have to reach $3000.
Why add additional risk to your investment when you can clearly see these stocks don't even follow bitcoin's highs, but crash much harder every time bitcoin does?
February 19, 2023, 10:53:16 AM
I would like to have some exposure to BTC outside of just the crypto market, and I have invested in some of the mining stocks like RIOT and MARA, what is your take on these companies moving forward?
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