Bitcoin Miners ETF Surges as Bitcoin Slides
The Valkyrie Bitcoin Miners ETF (WGMI) has seen significant gains over the past year, increasing nearly 97% while Bitcoin itself dropped 46%. This divergence reflects a change in business models for Bitcoin miners, with companies like Riot, Core Scientific, and IREN shifting towards AI and data-center deals. As a result, WGMI is no longer purely tied to Bitcoin's performance but instead linked to the broader trend of AI infrastructure and data centers.
Bitcoin experienced some upward movement after July's U.S. Producer Price Index (PPI) data came in lower than expected, with a 4.7% year-over-year increase compared to the forecasted 4.9%. The softer inflation reading led to reduced expectations of further Federal Reserve tightening, supporting U.S. equities and allowing Bitcoin some room for recovery.
Currently, BTC is trading at $63,350. The asset made a sharp fall from its all-time high of $126,199, correcting almost 52% before rebounding to around $82,850. However, the bulls failed to sustain their grip on the market, and prices have since consolidated within a range of $61,000 to $66,500 with declining volumes.