Crypto Miners Claw Back Losses Pre-Market As Powell’s Fed Stance On Bitcoin Fuels Debate

Bitcoin mining stocks faltered after Federal Reserve Chair Jerome Powell declared that the central bank is not allowed to own Bitcoin, quashing prospects for President-elect Donald Trump’s strategic BTC reserve initiative.

“The Federal Reserve says what we can own, and we’re not looking for a law change. That’s the kind of thing for Congress to consider, but we are not looking for a law change at the Fed,” Powell stated during the press conference.

Powell’s comments on the Fed owning Bitcoin follow speculation that Trump's incoming administration might seek to create a government-owned asset stock. 

Analysts and legal experts are divided on whether this can be done through executive powers or would require an act of Congress.

Bitcoin’s price slipped to $101,000 levels from $106,000 after the Fed’s announcement. 

The world’s largest cryptocurrency was trading at $101,547 as of 6:53 a.m. ET on Thursday.

On the equities side, Bitcoin-linked stocks also suffered, with MicroStrategy sliding 9.5%, Tesla shedding 8%, and Robinhood plunging nearly 11% on Wednesday.

However, Bitcoin miners were hit hardest, reflecting heightened market sensitivity to the news.

TeraWulf Inc.

TeraWulf Sentiment and Message Volume on Dec 19 as of 6:55 a.m. ET | Source: Stocktwits

TeraWulf stock emerged as the biggest loser among Bitcoin miners, plummeting 15% by the close on Wednesday.

The company specializes in sustainable data center infrastructure for Bitcoin mining and high-performance computing, utilizing zero-carbon energy sources like nuclear and hydroelectric power to minimize its environmental impact.

According to Stocktwits, sentiment surrounding the stock plunged 58.8%, while message volumes surged by 57.8% by the end of the session.

However, in Thursday’s pre-market hours, TeraWulf shares were up as much as 4%, partially recovering from Wednesday’s sharp losses. Retail sentiment remained in the ‘bullish’ zone with chatter at ‘high’ levels.’

Year-to-date, TeraWulf shares remain up an impressive 190%, despite the recent setback.

Riot Platforms

Riot Platforms Sentiment and Message Volume on Dec 19 as of 7:05 a.m. ET | Source: Stocktwits

Riot Platform stock endured the second-sharpest decline among peers, plunging 14.4% on Wednesday.

Stocktwits data showed retail sentiment around the Bitcoin mining and digital infrastructure company dropped 49.68% as message volumes dropped by 19.11% by the close of trading on Wednesday.

However, in pre-market trading on Thursday, Riot was up over 4%. Retail sentiment remained ‘neutral’ while chatter was subdued at ‘normal’ levels.

Riot Platforms stock is down 22% year-to-date as it faced diminishing returns for its mining operations after the Bitcoin halving event in Apr. 2024. 

Cipher Mining

Riot Platforms Sentiment and Message Volume on Dec 19 as of 7:10 a.m. ET | Source: Stocktwits

Cipher Mining tumbled 13% on Wednesday after the Federal Reserve’s comments. 

According to Stocktwits data, retail sentiment around the industrial-scale Bitcoin mining and data center company actually improved by 23.47% on Wednesday, despite the drop in share price. 

As of Thursday pre-market, the stock rebounded nearly 5%. Retail sentiment around Cipher remained ‘bullish’ with chatter at ‘normal’ levels. 

So far this year, the stock has gained over 50%.

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