Today, cryptocurrencies are once again in focus. For investors in Bitcoin (CCC:BTC-USD) and Bitcoin mining stocks, today is a very good day.
Indeed, the stock prices of prominent Bitcoin miners are all up today, significantly. Shares of Bit Digital (NASDAQ:BTBT), SOS (NYSE:SOS), Marathon (NASDAQ:MARA), Riot Blockchain (NASDAQ:RIOT) and Canaan (NASDAQ:CAN) are all up more than 6% at the time of writing, with many of these names up double digits.
Today’s price action in these stocks follows a similar 6% increase in the price of Bitcoin. As investors might guess, some important news is driving these stocks today. Let’s dive into what was announced and why investors appear to feel compelled to dive into Bitcoin mining stocks today.
Bitcoin Mining Stocks Up on Crypto Regulation Bill Amendment
High-profile funding proposals for President Joe Biden’s infrastructure bill have included crypto taxation. The specifics on how the crypto sector is to be taxed has been a key volatility driver in the crypto world in recent days.
However, today, it appears Bitcoin mining stocks have received some good news on this front. According to various sources, the White House is now backing an amendment to the Infrastructure and Investment Jobs Act. This amendment widely protects and favors proof-of-work mining (such as that carried out for Bitcoin), over proof-of-stake models. With taxation seemingly focused on transaction fees generated by “brokers” rather than miners, investors in Bitcoin mining stocks have been able to exhale today.
Now, it’s unclear as to whether additional amendments will be proposed. This bill isn’t final yet, and anything can happen. However, the current political landscape appears to be favorable to Bitcoin mining stocks right now. Accordingly, investors are pricing this into their models with these stocks today.
That’s not to say these proposals aren’t without controversy. Proof-of-stake mining has been cited as a much more environmentally friendly method of network management and block validation. With the environmental impact of Bitcoin mining a hot button topic, these regulations do little to address this issue.
But that’s neither here nor there for investors in Bitcoin mining stocks. At least for today, these stocks are seeing impressive gains.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
