Why CleanSpark Surged More Than 25% Today
Bullish momentum continues to permeate the cryptocurrency sector today, with CleanSpark (NASDAQ: CLSK) among the leading crypto-related stocks to see major moves. As of 2:45 p.m. ET, the Bitcoin (CRYPTO: BTC) miner has seen its share price surge 26.1% from yesterday's close, marking the continuation of a volatile start to the year, which has seen CleanSpark stock nearly double in less than two months.
Of course, because CleanSpark is a top Bitcoin miner, the price of Bitcoin ultimately dictates a great deal of its price action. Today, Bitcoin saw its token price jump above the $54,000 level for the first time in two years, a move that's generated a great deal of excitement in this overall sector. The 24-hour move for Bitcoin currently stands at around 5.4% at 2:45 p.m. ET, so let's dive into why investors are pricing in nearly five times as much upside.
Bitcoin mining stocks often have higher-volatility moves to the upside or downside during periods of intense volatility in Bitcoin prices. One of the easiest-to-understand realities in the mining sector is that revenue for these companies is denominated in Bitcoin, with costs denominated in dollars. So as the exchange rate improves (Bitcoin becomes more valuable), the income statement and the balance sheet for these firms both improve also. That's the sort of double whammy that increases their relative valuation over short periods.
Source Fool.com
