As Bitcoin Sinks, So Do Stocks With Ties to Cryptocurrencies
The rout in bitcoin is also taking down stocks with ties to cryptocurrencies.
Pareteum Corp. fell as much as 25 percent as of 10:16 a.m. in New York, while Digital Power Corp. and LongFin Corp. each slipped more than 6 percent after South Korea’s government said it wanted to clamp down on speculation, potentially by shutting down some exchanges. The warning sent bitcoin below $ 14,000, leaving it down 26 percent from last week’s record.
Overstock.com Inc., On Track Innovations Ltd., and Riot Blockchain Inc. also traded lower Thursday, in relatively light volume during a holiday-shortened week.
The crypto space has been on a wild ride this month, with the digital token bitcoin soaring to record highs before a dramatic selloff last week. The assets rebounded earlier this week, before resuming their slide lower in a test for investor enthusiasm in the asset class.
Such volatility isn’t new for bitcoin or its proxies. The digital coin has seen many peaks and valleys over the course of its history. This year, it’s climbed 1,400 percent and once reached more than $ 19,500. Related assets have largely moved in tandem with the cryptocurrency. Shares of Riot Blockchain and Digital Power, while taking a hit today, are still up 627 percent and 450 percent this year, respectively.