Cryptocurrency mining involves using powerful computers to solve complex mathematical problems that lead to the creation or "mining" of cryptocurrencies such as Bitcoin (BTC) or Ether (ETH). This includes verifying transactions made in a decentralized ledger where all cryptocurrency transactions are recorded. As a reward for their efforts in authenticating or confirming these transactions, miners earn cryptocurrency.
Historically, cryptocurrency mining can remain profitable even during "cryptogyms," although it usually thrives when things are better. Therefore, it can be said that mining companies have taken a defensive position in the world of cryptocurrencies.
The best cryptocurrency miners provide optimal mining speed to maintain a low operating temperature, use less power and reduce operating costs. Additionally, businesses that have access to affordable electricity have a clear advantage.
Geography is also an important factor in the success of a cryptocurrency mining company. First of all, there are countries that control the cryptocurrency market with a strict regulatory regime. It is difficult for mining companies to thrive in such conditions. For example, China is known to adopt similar regulations, leading to an exodus of cryptocurrency miners to countries with more favorable regulatory frameworks. Countries like Kuwait, Algeria and Sudan were also hotspots due to profitability.
In the future, shares of cryptocurrency mining companies look profitable and have significant growth potential. The cryptocurrency market may not be reaching the highs of 2021 right now, but it has long passed the sharp lows of 2022. As cryptocurrencies gain more acceptance in traditional commerce and continue to close the gap between independence and the regulatory framework, the demand for mining is expected to grow. operations may increase, which may result in an increase in the value of these inventories. So it would be wise to keep an eye on the top three cryptocurrency mining stocks and their returns this year.
CLSK: This cryptocurrency miner uses advanced microgrids and electrical equipment designed for Bitcoin mining, which greatly reduces electricity costs and increases operational efficiency. CleanSpark shares are up 129.9% year-to-date (as of August 22).
CleanSpark's expected profit growth rate next year will be 89.1 percent. The Zacks Consensus Estimate for this year's earnings has improved by 5.2% over the past 60 days. The company currently has a Zacks Rank #2 ("Buy"). The full list of Zacks' number one (strong buy) stocks today can be seen here .
Stronghold of Digital Mining , SDIG Inc .: This is a crypto-active mining company that specializes in Bitcoin mining in the US. The company's shares have grown by 16.1% since the beginning of the year (as of August 22).
Stronghold Digital Mining's expected earnings growth rate for the current year is 97.7 percent. The Zacks Consensus Estimate for current year earnings has improved by 68.2% over the past 60 days. Stronghold Digital Mining is currently ranked #3 by Zacks (Hold).
Limited cellular digital technology. HIVE - This cryptocurrency mining company operates in Canada, Sweden and Iceland. It works in the field of mining and selling digital currencies. Since the beginning of the year (as of August 22), its shares have grown by 141.7%.
HIVE's expected profit growth rate for the current year is 72.3 percent. The Zacks Consensus Estimate for this year's earnings has improved by 39.4% over the past 60 days. HIVE is currently ranked #3 by Zacks.
the end
Unlike most cryptocurrency markets, mining companies are usually regulated and therefore offer "stability" to investors, which is an unusual feature in the volatile cryptocurrency space. The aforementioned stocks are on an upward curve and are worth watching as the cryptocurrency market continues to rise.
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