Crypto-related stocks MicroStrategy Inc (NASDAQ: MSTR) and Coinbase Global Inc (NASDAQ: COIN) rallied on Tuesday, fueled by Bitcoin's upward momentum. Below, we break down the key drivers behind this market movement.
Why Are Bitcoin and Crypto Stocks Rising?
Bitcoin's Bullish Breakthrough
- Bitcoin crossed $71,000 on Tuesday morning—its highest level since June 2024.
- The cryptocurrency was up 3.76% over 24 hours, trading at approximately $71,600 at the time of reporting.
ETF Inflows Boost Market Confidence
- Bitcoin ETFs recorded inflows of $479 million on Monday.
- These funds have seen consistent inflows for 11 of the past 12 trading days, signaling strong institutional demand.
👉 Why Bitcoin ETFs are gaining traction
How MicroStrategy and Coinbase Benefit
MicroStrategy: A Bitcoin Proxy
- The company holds 226,331 Bitcoin (as of June 30) with an average purchase price of $36,821 per BTC.
- Its stock volatility allows low-cost capital raising, enabling further Bitcoin acquisitions.
Coinbase: Riding Crypto Volatility
- As a leading crypto exchange, Coinbase thrives on market volatility, which drives higher trading activity.
Upcoming Earnings Reports
Both companies are set to release Q3 2024 earnings after Wednesday's market close:
| Company | Estimated EPS | Estimated Revenue |
|--------------|--------------|--------------------|
| Coinbase | $0.43 | $1.253 billion |
| MicroStrategy | ($0.14) | $122.66 million |
FAQ Section
Q1: Why is Bitcoin’s price rising?
A1: The surge is attributed to strong ETF inflows, increased derivatives activity, and broader market optimism.
Q2: How does MicroStrategy’s Bitcoin holding affect its stock?
A2: MicroStrategy’s stock closely tracks Bitcoin’s price, making it a high-volatility proxy for BTC exposure.
Q3: What drives Coinbase’s revenue?
A3: Coinbase earns primarily from trading fees, which rise during periods of crypto market volatility.
👉 Explore crypto market trends
Key Takeaways
- Bitcoin’s breakout past $71K lifted related stocks.
- MicroStrategy and Coinbase are set to report earnings midweek.
- ETF inflows and derivatives activity signal sustained institutional interest.
Disclaimer: Crypto markets are highly volatile. Conduct your own research before investing.
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