4 Crypto Stocks Outpace Bitcoin on Election Day: What Drove the Jump?

Source Beincrypto

Crypto stocks Coinbase, Strategy, Riot Platforms, and MARA Holdings jumped between 5% and 13% by late Tuesday morning. Bitcoin (BTC), the asset all four depend on, rose just 0.3% over 24 hours.

The bounce recovered only part of a two-day slide that cut the four stocks by 8% to 14%. Their shareholders face daily swings far larger than Bitcoin’s.

What Sent Crypto Stocks Higher on Election Day?

Three developments landed together on Tuesday. The stocks were rebounding from a two-day sell-off, and tech stocks were recovering.

The Nasdaq Composite climbed about 1% after losing 3.9% over the previous two sessions.

The third was company news for Coinbase, the largest US crypto exchange. The Commodity Futures Trading Commission (CFTC) cleared equity perpetual futures on Tuesday.

These never-expiring contracts track single US stocks, and Coinbase’s derivatives arm had filed to list them.

Yet Riot, a Bitcoin miner that runs no trading venue, rose the most at 13.3%. Coinbase gained 8.6%, MARA 7.6%, and Strategy 5.4% shortly before 11 a.m. ET.

Crypto Stocks vs Bitcoin Performance on November 3. Source: Yahoo Finance, CoinGeckoCrypto Stocks vs Bitcoin Performance on November 3. Source: Yahoo Finance, CoinGecko

Miners earn new Bitcoin by running specialized computers. Strategy buys and holds Bitcoin as its core business.

Are Short Sellers Behind the Bounce?

Short sellers borrow shares and sell them, hoping to buy back cheaper. A sharp rise can force them to buy back quickly, lifting prices further.

Short interest in MARA reached 111.9 million shares in mid-October, up from 100.8 million two weeks earlier, Nasdaq data show.

Riot’s short position rose to 53.6 million shares over the same period. Late-October figures are not yet published, so the role of short covering remains unconfirmed.

What Could Undo Tuesday’s Rally?

Barclays cut its Coinbase target to $120 last week after October trading fees reached only about $165 million.

Still, Coinbase has started quarters slowly before. It reported about $130 million through July 26, yet third-quarter trading revenue closed at $590 million, per its deck.

Riot reports third-quarter earnings before Wednesday’s open. Analysts expect a loss of $0.32 a share.

US midterm results also land overnight. Investors in a Bloomberg survey tied Bitcoin’s $100,000 chances to a Republican Congress winning.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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