Disclaimer: The analyst who wrote this piece owns shares of MicroStrategy (MSTR)
It’s been a tough month for MicroStrategy (MSTR), the software developer turned bitcoin (BTC) accumulator. Its stock has tumbled almost 50% since November, when it joined the Nasdaq 100 index and peaked at a 600% gain since the start of the year.
That still leaves the Tysons Corner, Virginia-based company a whopping 342% ahead in 2024, the biggest return among the highest-profile crypto-linked assets in traditional finance (TradFi).
It’s been a volatile year, packed with geopolitical and technological developments to rattle financial markets. The continuing wars in eastern Europe and the Middle East, elections across the globe, the unwinding of the yen carry trade in August and the growth of artificial intelligence (AI) have all left their marks.
MicroStrategy’s gain is almost double that of Nvidia (NVDA), the chipmaker whose production of integrated circuits needed for AI applications fueled a 185% return, the best among the so-called magnificent seven tech stocks. The next best, Meta Platforms (META), turned in 71%.
Bitcoin itself rose 100% in a year that included April’s reward halving and multiple record highs. Demand for the largest cryptocurrency was driven by the January approval of spot exchange-traded funds (ETFs) in the U.S. Bitcoin outperformed two of its biggest competitors, ether (ETH), up 42%, and Solana (SOL), up 79%.
Among the ETF’s iShares Bitcoin Trust (IBIT) also returned over 100% and became the fastest ETF in history to hit $50 billion in assets.
Bitcoin mining companies, on the whole, disappointed. Valkyrie Bitcoin Miners ETF (WGMI), a proxy for mining stocks, rose just under 30%. That’s despite demand for the miners’ computing capabilities and power supply agreements from artificial intelligence and high-performance computing (HPC) companies. Still, individual companies benefited, in particular, Bitdeer (BTDR),which added 151%, and WULF (WULF)
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Author: James Van Straten
