Cryptocurrency-related stocks surge amid positive response to executive order

The broader market reaction came after President Joe Biden signed a long-awaited executive order directing U.S. federal agencies to create a regulatory framework for digital assets and explore a future digital dollar, Shares of cryptocurrency-related companies have surged.

Coinbase ( COIN ) jumped 10.5% by the close, while bitcoin advocate Michael Saylor's MicroStrategy (MSTR ) rose 6.4%, according to TradingView.

Blockchain-related exchange-traded funds (ETFs) were also affected by renewed confidence in cryptocurrencies, with the ProShares Bitcoin Strategy ETF (BITO) up 10% and the Valkyrie Bitcoin Strategy ETF (BTF) closing up 10.3%.

Shares in crypto mining companies were the biggest gainers, with Riot Blockchain Inc. (RIOT) up 11.2 percent and Marathon Digital Holdings Inc. (MARA ) up 13.5 percent. In a note to clients, Jefferies analyst Jonathan Peterson reportedly reinstated his buy rating on MARA, saying that as the U.S. government "more formally recognizes, engages, and appears to support" the digital asset industry, crypto miners May benefit.

While a 10% swing is common in cryptocurrencies, it is unusual in traditional markets. While Coinbase’s price has risen over the past day, it’s still down nearly 48% from its direct listing price last April, while RIOT is faring even worse, now down 76% from its most recent high in February 2021.

Bitcoin itself was up 9% after details of the executive order leaked last night, before slipping back to a 5% gain at the time of writing.

In addition to immediately showing positive price action, most investors believe that this executive order is a much better, if not a net benefit, for the cryptocurrency industry than previously feared. President Biden called the rise of digital assets an "opportunity to strengthen America's leadership at the forefront of the global financial system and technology."

The order did not specify what kind of regulatory measures might be taken, but the general mood of the U.S. federal government appears to be positive — implying that the executive order could expand the adoption of virtual currencies within the U.S. financial system.

U.S. Treasury Secretary Janet Yellen further backed that view, saying in a statement that the legislation would help consumers and businesses.

Yellen said: "President Biden's historic executive order calls for a coordinated and comprehensive approach to digital asset policy. Such an approach will support trusted innovation that may deliver substantial benefits to the nation, consumers, and businesses. "

Minnesota Congressman Tom Emmer offered an insightful analysis of the areas obscured by the executive order, warning his 48,000 Twitter followers that they had no reason to expect the U.S. government to prioritize open, permissionless or private technology. policy.

Decentralization is the point: the executive order doesn't mention decentralization once. The disintermediation of our economy will allow all Americans, no matter what the circumstances, to determine their own future, not by banks, Big Tech, or the government.

— Tom Emmer (@RepTomEmmer) March 10, 2022

However, he added that one of the most promising parts of the executive order is that it "does not require the SEC to get involved." Over the past year, SEC Chairman Gensler has been terrorizing crypto innovators and entrepreneurs through public statements and enforcement actions. His opinion is not critical. "

Regardless, Gensler weighed in on the news, deciding to tweet support for Biden's regulatory efforts.

Today, the President of the United States signed an executive order on crypto assets. I look forward to working with colleagues across government to achieve important public policy goals: protect investors and consumers, guard against illicit activity, and help ensure financial stability.

— GaryGensler (@GaryGensler) March 9, 2022

Given Gensler's frequent skepticism of the digital asset industry, his tweets were criticized by some in the Twitter cryptocurrency community.

Messario Crypto CEO Ryan Selkis took direct aim at Gensler, claiming that Gensler's goals have nothing to do with investor protection.

With any luck, your opinion will be completely excluded from meaningful scope, because your personal goals have nothing to do with protecting investors, stabilizing markets, or preventing illegal activity.

— Ryan Selkis (@twobitidiot) March 9, 2022

Stocks rose broadly on Wednesday, with the S&P 500 up 2.5% despite ongoing geopolitical tensions in Eastern Europe.

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