Q: What's up with HIVE? It is getting pummeled pretty hard even though BIT coin is still over 90 grand. Between Hive's holdings of BIT and over cash what per centage of the market capital is covered. Seems like HIVE is oversold. Agree?
5i Research Answer:
Most bitcoin miners have been hit hard in recent weeks amid a selloff in the small-cap index, and potentially some tax-loss selling into year-end. Bitcoin has corrected from a high of $108K to $92K, which sent the high beta crypto miners sharply lower. Nothing has fundamentally changed with these companies with the exception of a lower bitcoin price.
HIVE holds 2,713 bitcoins ($371M) and $7M in cash as of the latest quarter. Rounding up, its cash and bitcoin holdings are valued at roughly $380M, with a market cap of $550M, meaning almost 70% of its market cap is in cash and bitcoin. We feel a bounce could be coming for these names given the large selloff and timing of tax-loss selling.