Cryptocurrencies rose sharply on Monday as investors returned to the market. Bitcoin It is trading above $53,000 for the first time since November 2021, and this is pushing the entire market higher.
Bigger movements occurred. Ethereum (ETH 1.88%) It has jumped 8.3% since the market closed on Friday. close protocol (close 9.17%) rose 21.3% on Monday, and Coinbase (currency 16.84%) jumped 16.9%. Bitcoin miners Digital Marathon And Riot pads They rose 21.7% and 17%, respectively, at the end of today's trading. This is a momentum that has been building for a while, but for some, it may continue.
Ethereum gets an upgrade
The Ethereum blockchain network will get an upgrade called Dencun in mid-March, which is expected to increase throughput and reduce costs on the blockchain. This could make blockchain more usable for utility, which has always been the promise of cryptocurrency.
Grayscale, a cryptocurrency asset management company that has several cryptocurrency funds, has touted the upgrade as a long-term catalyst for Ethereum. They also think it could be the next to be approved for an exchange-traded fund (ETF).
Near Protocol stock is up significantly as well, but that's largely because it's following upward moves across the industry. There was no specific news. Speculation led to a rally near the day.
Shine miners
It should come as no surprise that the rising price of Bitcoin has led to a jump in Bitcoin mining stocks. Not only do these companies generate revenue from Bitcoin mining – so their revenue and gross margin will rise as Bitcoin does – but they also hold Bitcoin on the balance sheet. This gives them double leverage when the price of Bitcoin rises, which is what we are seeing today.
Coinbase is riding the tide
Riding the wave of cryptocurrency momentum is Coinbase, an exchange and cryptocurrency infrastructure company. Trading is a big part of Coinbase's business, but it also signals more activity on the blockchain from developers and perhaps financial institutions.
The upside is that products like wallets, Base Blockchain, cloud tools, commerce apps, and more will run on Coinbase. This is where the company's service products are headed and why this could be a disruptive company in the long run.
The end of the crypto winter
It has become clear over the past six months that the crypto winter may be over. Trading is up, valuations are up, and there is more development and investment in the industry than before the recent bull market. This will likely lead to more activity on the blockchain, even if the resulting value is not evenly distributed.
Blockchains that can provide real utility through smart contracts, fast transactions, and low costs will add value and can be disruptive technologies. This is why Ethereum upgrades are so important as developers look for more use cases.
I think the best way to invest in crypto recovery is with Coinbase because they benefit no matter what type of blockchain the activity goes to. It could outperform all its competitors in the cryptocurrency space in 2024.
Travis Hoium has positions in Coinbase Global and Ethereum. The Motley Fool has positions in and recommends Bitcoin, Coinbase Global, and Ethereum. The Motley Fool has a disclosure policy.
