Prices of cryptocurrencies, Bitcoin (BTC-USD) and Ethereum (ETH-USD) soared on October 25 in what appears to be a relief rally following the positive results of the big earnings week. On Tuesday, Bitcoin crossed the $20,000 mark and Ethereum traded past $1,500.
Following the surge in crypto prices, the stocks of most crypto mining and blockchain companies jumped. Shares of Coinbase Global (COIN) rose 13%, Marathon Digital (MARA) jumped 14.4%, Hive Blockchain (HIVE) soared 12.1%, and MicroStrategy (MSTR) spiked 13.1%.
Let us look at two Canadian mining companies that are poised to benefit the most from reignited investor confidence in cryptocurrencies.
Hut 8 Mining Corp. (NASDAQ:HUT) (TSE: HUT)
HUT stock gained 17.2% yesterday to close at $2.32. Hut 8 Mining produces bitcoin through industrial-scale mining operations in Canada. Year to date, HUT stock has lost 70.1% vis-à-vis gaining 31.8% in the past three months.
Is Hut 8 a Good Stock to Buy?
With two unanimous Buys, HUT stock has a Moderate Buy consensus rating. On TipRanks, the average Hut 8 Mining price target of $5 implies 115.5% upside potential to current levels.
Hut 8 continues to improve its hashrate capacity and mining efforts month-over-month. Amid the crypto rout, HUT stock has taken a severe beating and is trading at 86% discount to its 52-week high of $16.57.
Bitfarms Ltd. (NASDAQ:BITF) (TSE:BITF)
Bitfarms stock gained 16.2% from the crypto surge yesterday and continued its upward trajectory in pre-market trading today. Bitfarms has 10 mining farms across four countries and boasts a current hashrate capacity of 4.2 exahash/second. BITF stock has lost 78.2% so far this year.
Is BITF stock a Buy?
Based on one Buy rating, BITF stock has a Moderate Buy consensus rating. The average Bitfarms price target of $5 implies a humongous 354.5% upside potential to current levels. Similar to HUT stock, BITF stock currently trades at 88% discount to its yearly high of $9.36.
The prices of cryptocurrencies continue to impact the stock prices of blockchain and mining companies. Other than this, macro factors such as rising interest rates and the impending regulation of the crypto market will soon determine the trajectory of the sector.