Crypto stocks experienced a significant upswing on Monday, primarily driven by the positive momentum surrounding the recent developments in U.S. digital asset legislation and Bitcoin’s ascent above the $80,000 mark. Leading this charge were Circle (CRCL) and Coinbase (COIN), both of which reported substantial gains. Circle, known for its issuance of the USDC stablecoin, witnessed an 18% surge, building on its previous successes. Meanwhile, Coinbase, a major player in the U.S. crypto exchange market, saw its stock rise by nearly 7%.
Other companies in the sector also benefitted from this bullish trend, with BitGo (BTGO), a digital asset infrastructure firm specializing in custody and stablecoin services, climbing approximately 10%. Meanwhile, MicroStrategy (MSTR), recognized as the largest corporate holder of Bitcoin, along with crypto-friendly broker Robinhood (HOOD) and Ethereum treasury company Bitmine (BMNR) each registered gains of 3-4%, reflecting a broader market rally.
The catalyst for this rally was Bitcoin’s breakthrough as it soared above $80,000, marking its highest level since late January. This milestone contributed to a nearly 2% gain over the past 24 hours for Bitcoin, significantly impacting the overall crypto benchmark, the CoinDesk 20 Index, which increased by 1.2%.
Investor sentiment was further lifted by the advancement of the Digital Asset Market Clarity Act— a pivotal legislative initiative aimed at regulating the crypto markets in the U.S. Recent developments have indicated that a compromise has been reached regarding the contentious issue of yield on stablecoin balances. The proposed legislation would prevent stablecoin issuers from providing yield on idle balances but would still permit rewards associated with transaction activity, effectively addressing one of the bill’s most debated provisions.
Markus Thielen, founder of 10x Research, indicated that this clarification is crucial, stating that it could signal a significant step toward formal passage of the legislation. He noted that the removal of this obstacle positions lawmakers to advance the bill, possibly leading to a formal markup as early as this week.
The likelihood of the bill’s passage has increased on prediction platforms like Polymarket, with odds rising to 64%, reflecting a growing confidence in the legislation’s future. Consequently, Thielen remarked that equity markets are beginning to anticipate potential beneficiaries of these developments.
Circle, in particular, stands out as a likely winner from the proposed regulatory framework, especially if stablecoins are officially recognized as payment tools rather than yield-bearing assets. The anticipation surrounding Circle’s upcoming earnings report, scheduled for next week, adds additional momentum to its stock. Investors remember the sharp increase of approximately 100% following the release of the last quarter’s report in February, indicating that positioning for potential future gains is already underway.
