Spil the price of bitcoin shoots past fresh highs since the commence of the year, the uitzicht of so-called bitcoin mining becomes more and more alluring. Not remarkably, companies that provide bitcoin mining-related hardware, such spil high-power graphics cards, are profiting from the bitcoin mining boom. Fortunately for investors, some of thesis companies are publicly traded on the stock exchange.
What is Bitcoin Mining?
Mining bitcoin refers to the generation of fresh bitcoins by bitcoin network participants who use their computational power to verify and process transactions on the bitcoin blockchain. By ensuring that the network is running slickly and all onberispelijk transactions are being processed, bitcoin miners are financially rewarded with fresh bitcoin.
Presently, the bitcoin block prize is 12.Five, which means that miners receive 12.Five bitcoins for every fresh block mined on the blockchain. A fresh block is created harshly every Ten minutes, contains several confirmed transactions, and will have had several miners involved te the process. Hence, the 12.Five fresh bitcoins will be split among the miners involved ter the creation of the block. That means miners are ter competition with each other to confirm more and more transactions to get a thicker lump of the bitcoin mining prizes.
Therefore, there is somewhat of a hardware arms wedstrijd among bitcoin mining operations spil they continuously attempt to increase the speed and efficiency of their mining equipments. One way of doing that is by investing te the newest and most powerful graphics cards that can be used to boost mining efficiency.
Top Bitcoin Mining Stocks
There are two publicly-traded US companies that produce bitcoin mining graphics cards and, unsurprisingly, their share prices have bot enlargening along with the price of bitcoin since the begin of the acute bitcoin rally te 2018. The two listed companies are AMD and Nvidia.
Advanced Micro Devices (NASDAQ:AMD)
Advanced Micro Devices Inc. is a California-based company that develops laptop processors and primarily concentrates its GPU products on the gaming community. However, some of their GPUs can also be used to improve the efficiency of bitcoin mining equipments. This has bot very beneficial for the company spil the bitcoin mining boom has boosted the request for its graphics cards te latest months.
An AMD spokesperson told CNBC:
“The gaming market remains our priority. Wij are observing solid request for our Polaris-based offerings te the gaming and freshly resurgent cryptocurrency mining markets based on the strong spectacle wij are delivering.”
AMD is listed on the Nasdaq exchange and has a market capitalization of $12 billion. Ter the past 12 months, its shares generated a terugwedstrijd on investment of overheen 75 procent and ter its last earnings report, the company enhanced its projecting sales by $100 million dollars for the current quarter.
Nvidia Corporation is a California-based GPU and laptop chip producer that concentrates its products on the gaming and professional markets. Similarly to AMD, it has developed GPUs that are particularly efficient for bitcoin mining to capitalize on the resurgence of the bitcoin mining boom.
Nvidia’s Pascal-based GPUs are said to be particularly effective for bitcoin mining and superior to those of AMD. Hence, they have gained substantial popularity among mining operations ter latest months, which has boosted the company’s earnings.
According to research conducted by Mitch Steeve, a Capital Markets Analyst at RBC, “If wij switch to building a utter Gegevens Center environment, electrical costs become increasingly more significant (Bitcoin environment), and the older NVIDIA GPUs outperform AMD overheen the course of a year.”
Nvidia is listed on the Nasdaq exchange and has a market capitalization of around $100 billion and has generated a come back of overheen 150 procent ter the past 12 months for its shareholders.
Nvidia has bot shown to have a closer correlation with the price of bitcoin compared to AMD. Hence, if you want officieus exposure to the price of bitcoin spil well spil bitcoin mining ter your stock portfolio, Nvidia might be the better stock pick.
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