Although relatively young, the bitcoin business is expanding quickly. Bitcoin (bitcoin trading software) is the most well-known cryptocurrency, and they are a relatively new type of digital money. Bitcoin trading technology, which is used by cryptocurrencies, enables the upkeep of a secure and decentralized transaction record without the need for a reliable third party. To authenticate transactions on a blockchain and create new cryptocurrency coins, cryptocurrency mining businesses employ computers to tackle challenging computational problems. Riot Blockchain Inc., Marathon Digital Holdings Inc., and HIVE Blockchain Technologies Ltd., both situated in Canada, are a few of the well-known companies in the cryptocurrency mining sector.
The third quarter for most publicly traded cryptocurrency mining companies has been incredibly disappointing as the fiscal year came to a finish and investors got ready for the fall market.
Except for Hut 8, all the top mining operations are failing bitcoin this quarter. In terms of percentage change, Riot fell almost as drastically as bitcoin did this quarter. Ebang and Canaan, two manufacturers, saw their share prices decline by double-digit percentages for the second quarter.
Comparing mining stocks to Bitcoin and occasionally other top cryptocurrencies, they are typically seen as high beta investment opportunities. Mining stocks typically increase more as bitcoin prices rise. And the impact is reversed when the price of bitcoin falls. But despite bitcoin increasing by 23% this quarter, almost all the top mining stocks fell short of beating it. At the beginning of Q3, Bitcoin experienced a big decline. The top cryptocurrency has also been trading in a range around the low $40,000s for the last few weeks. While the price of bitcoin has been flat, certain mining stocks have witnessed significant gains, but overall, returns have been at best average.
Top crypto mining stocks for Q3
These are the cryptocurrency mining stocks with the lowest price-to-sales (P/S) ratio over the previous 12 months. It can be used in place of another preliminary estimation of a company’s value for start-ups or sectors experiencing significant shocks. When a business achieves profitability, it may eventually generate greater profit due to its higher sales.
- HIVE Blockchain Technologies Ltd.
A cryptocurrency mining business with an emphasis on connecting the blockchain industry to conventional capital markets is HIVE Blockchain Technologies, which is situated in Canada. At its data centers in Canada, Sweden, and Iceland, it mines digital currencies like Bitcoin and Ethereum.
Hive’s projected yearly run rate for revenue is $280 million. The cash flow projection is strong with the increase of Bitcoin and Ethereum mining in 2022. Additionally, DeFi Technologies is 4.9% owned by Hive Blockchain. It exposes the business to the rapidly expanding decentralized financing sector. In addition, Network Media Group received a strategic investment from Hive Blockchain. It exposes the business of NFT to the corporation.
Price ($) | Market Cap ($M) | 12-Month Trailing P/S Ratio | |
HIVE | 4.18 | 343.8 | 2.1 |
- Canaan Inc.
Canaan is a high-performance computer provider with its headquarters in China. It is concentrated on the design of computing chips, chip research and design, the manufacturing of computing hardware, and software services. The business provides computing hardware to the cryptocurrency mining sector. The board of directors of Canaan approved a share repurchase program in mid-March, allowing the business to buy back up to a hundred million worth of its American depositary shares.
Price ($) | Market Cap ($M) | 12-Month Trailing P/S Ratio | |
Canaan Inc. | 3.75 | 701.0 | 1.9 |
- Bitfarms Ltd.
Bitfarms is a bitcoin mining business situated in Canada. It provides on-site technical support, analytics, and engineering and installation services in addition to mining activities. Early in March, the company revealed that it had added property in the Canadian province of Quebec, bringing the total of farms it was developing to four.
Price ($) | Market Cap ($M) | 12-Month Trailing P/S Ratio | |
Bitfarms Ltd. | 1.96 | 398.1 | 10.9 |
Other examples
Among the stocks of crypto mining companies, Hut 8 is also seeking strong growth and appears appealing. The company is well-positioned for a substantial improvement in financial stability with strong mining activities through 2022. Hut 8 has already started using expensive, high-performance NVIDIA CPUs. Due to the low power intensity of these chips, the business charges roughly $3,000 per Bitcoin. It resulted in a unit margin that was more than 95%.