Bitcoin Surges 26% in 10 Days as Crypto Treasury Stocks Rally Amid Regulatory Optimism
Bitcoin reached an all-time high of over $126,000 in October last year but then plunged more than 53% by early July 2024. Since then, it has been recovering, with a sharp rally in recent days pushing its price up about 26% over the last ten days, briefly surpassing $80,000 this week before some pullback.
This surge has boosted shares of crypto treasury companies, which hold significant Bitcoin assets. The largest, MicroStrategy, led by Michael Saylor, currently holds about 4% of all Bitcoin globally, valued at roughly $67 billion. Since mid-August, MicroStrategy’s stock rose nearly 32% to a market cap of $48.7 billion, still 73% below its peak last year. Notably, MicroStrategy sold Bitcoin in June for the first time in over three years, despite Saylor’s previous statements that it would never sell.
Other treasury companies also saw double-digit stock gains amid Bitcoin’s price rise. Among them, Israeli dual-listed company Zooz Strategy’s shares increased 13.8%. Zooz holds over 1,000 Bitcoins valued at about $84 million, while its market cap is significantly lower at $49 million. Zooz purchased its Bitcoins at an average price above $116,000.
Ilan Shtrak, CEO of Altshuler Shaham Horizon, attributes the recent Bitcoin rally to a tenfold increase in daily trading volume and key events such as the U.S. Treasury Secretary’s announcement on buying long-term U.S. government bonds, which weakened the dollar and increased demand for risk assets like Bitcoin and gold. Regulatory optimism also played a role, with former President Trump urging Congress to advance the CLARITY Act to establish a regulatory framework for crypto assets, aiming to make the U.S. a global crypto hub.
The rally triggered a short squeeze, forcing short sellers to buy Bitcoin, further driving up prices. Shtrak also noted a reversal in ETF flows, with $2.5 to $3 billion moving into crypto funds recently. Yossi Barnea, CEO of blockchain company Tactona, echoed these views, highlighting that lower U.S. bond yields and dollar weakness improve liquidity and risk appetite, benefiting Bitcoin.
Barnea cautioned that while Bitcoin has experienced multiple rallies over the past decade, predicting a return to $130,000 is uncertain. However, he sees Bitcoin stabilizing between $60,000 and $70,000 with reduced volatility and consistent demand, suggesting the positive trend may continue. Tactona’s stock also jumped 27% recently without company news, with a market cap of 49 million shekels.
Investors seeking Bitcoin exposure without direct leverage may consider treasury stocks, which act as leveraged products. MicroStrategy receives mostly positive analyst recommendations, with average price targets implying over 90% upside. Shtrak noted growing interest and trading volumes in Israel’s crypto sector.
Overall, Bitcoin’s recent price surge and regulatory developments have revitalized investor sentiment in crypto assets and related stocks, though prices remain below last year’s peaks.
