- Cryptocurrencies have bounced back this month, with bitcoin up 11%.
- Investing in crypto mining stocks offers a route into the sector without adding individual tokens’ volatility to a portfolio.
- Insider breaks down the highest-rated bitcoin miners right now, according to TipRanks.
After a sluggish start to 2022, bitcoin has chalked up a second straight month of gains in March.
The largest cryptocurrency by market capitalization has gained 11%, taking it towards $50,000 and meaning it’s up about 3% year-to-date.
Analysts are divided on whether the “crypto winter” is over, or this month will just prove to be a temporary respite. But unsure investors could buy bitcoin mining stocks as an alternative to individual tokens, which can be a lot more volatile.
These companies own computers that “mine” cryptocurrencies by solving complex mathematical problems. That means that they profit when the price of bitcoin rises.
Mike Venuto, who manages a blockchain-focussed ETF for the investment firm Amplify, told Insider he invests in bitcoin mining stocks because there is lower potential downside if crypto enters a
“Lots of these companies actually project their earnings based on bitcoin’s price being $30,000,” he said. “Our fund won’t suffer quite as much [in a crypto winter], because we have a portfolio of companies with real earnings.”
To determine which crypto-mining companies are strong stocks to buy right now, Insider looked at TipRanks‘ analyst consensus metric for any publicly traded bitcoin miner with a market capitalization over $300 million. The research firm surveyed top stock pickers’ notes over the past three months to calculate a target price for each stock.