Bitcoin Surge Reverses Hierarchy in Digital-Infrastructure Trade
The recent surge in Bitcoin has led to a significant shift in the digital-infrastructure trade. Over the past month, Bitcoin has gained 22.49%, making it one of the top performers among tracked equities. Among them, Canaan (NASDAQ: CAN) rose by 66.99%, American Bitcoin (NASDAQ: ABTC) by 53.71%, and Cango (NYSE: CANG) by 40.96%. CoreWeave (NASDAQ: CRWV), Nebius (NASDAQ: NBIS), and IREN gained 21.45%, 17.10%, and 14.63% respectively, while several miners that emphasized AI and high-performance computing finished flat or lower.
The divergence is striking, as capital had previously flowed towards contracted AI capacity, power pipelines, and data-center development, while Bitcoin struggled through a bear market. However, the latest rally reversed this hierarchy, with direct exposure to Bitcoin outperforming the promise of future AI revenue.
The move began with a macro catalyst - the U.S. Treasury's decision to double the maximum size of buybacks for older 10- to 30-year government securities. This led to a short squeeze in Bitcoin, which rose as much as 23% during the week and reached its highest level in three months.
Spot demand is seen as the key driver behind the rally's continuation. U.S. spot-bitcoin exchange-traded funds have taken in $2.57 billion since August 17, with a net $1.92 billion arriving between August 17-21 and another $651.9 million on August 24-25.