What happened
A bad day for the leading cryptocurrencies typically means a bad day for cryptocurrency mining companies. Sure enough, on a Wednesday where both Bitcoin and Ethereum sagged in U.S. dollar price, so did major miners.
This was compounded by disappointing preliminary earnings from a peer. As a result, shares of Bitcoin-digger Bit Mining (NYSE: BTCM) slipped by more than 9% on the day, followed by Riot Blockchain (NASDAQ: RIOT) and CleanSpark (NASDAQ: CLSK), with declines at around the 7% mark.
Image source: Getty Images.
So what
Greenidge Generation Holdings (NASDAQ: GREE), a member of that crypto-mining club, reported preliminary Q4 and full-year 2021 results Wednesday morning. The Bitcoin miner expects to post revenue of around $44 million for the period, with a net loss coming in at $41 million to $51 million.
These results, with that gaping net loss, clearly didn't please investors. They unceremoniously traded the stock down by nearly 12% on the day.
With major cryptos like Bitcoin still getting smacked by the bears, and a peer reporting a likely deep bottom-line deficit, few investors were interested in Bit Mining, Riot Blockchain, CleanSpark, or basically any other company extracting digital coinage. I should note that none of those three companies had any negative news of their own that would have organically driven down their share prices.
Now what
Zooming out on a wider picture, investors still remain hesitant about cryptocurrencies, in general.
The Fed is almost certain to start raising interest rates in the very near future, a move that typically drains investment monies out of more speculative assets -- and cryptocurrencies are Exhibit A for such investments. And if investors shy away from digital coins and tokens, you can bet your bottom Bitcoin they'll keep avoiding mining stocks, too.
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Eric Volkman owns Bitcoin and Ethereum. The Motley Fool owns and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.
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