Penny stocks looking to pounce on the cryptocurrency buzz are enjoying a renaissance triggered by bitcoin’s new momentum.
For example, MGT Capital Investments — which trades for less than 10 cents per share — on Tuesday announced plans to resume bitcoin mining operations, citing the cryptocurrency’s now 12-day rally to top $8 000. That pushed shares up as much as 15% on Tuesday, as traders funnelled money back to the stock; market cap was about $16.2 million versus a 2017 peak of nearly $350 million.
Read: Bitcoin tops $8 000 as resurgence of cryptocurrencies goes on
It remains to be seen how many other penny stocks will incorporate “bitcoin” into press releases. They may find it tempting as the biggest cryptocurrency has gained 60% in a more than two-week climb, compared to a bloody stretch for US equity markets that wiped more than 3% from both the S&P 500 Index and the Dow Jones Industrial Average.
Other fan-favourite firms that are focused on cryptocurrencies are trading higher. Shares of Riot Blockchain, Marathon Patent Group, and Grayscale Bitcoin Trust BTC were all outperforming the market on Tuesday, pacing to extend comebacks of their own.