Paul Vigna

speaker

1,291 appearances 13 recordings 1 series first heard Jul 2017 last heard Apr 2022

Paul Vigna’s voice in public audio — every appearance, attributed to the second.

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WSJ Your Money Briefing · Why Crypto Stocks Are Performing Worse Than Cryptocurrencies · 21 Apr 2022 podcast

That's this year.

Year to date, it's down 40 percent.

Earlier this week, it hit a new all-time low around $145 a share.

The stock is just down significantly.

So that's what's really going on here is that you just have this huge divergence in the magnitude of the losses.

It was a little bit surprising to me, which is why I ended up writing about it, because I have one of my watch lists on my computer is just all these different crypto stocks.

And I just started noticing that they are down and they were down just much, much worse off than the cryptocurrencies.

But when you start looking into it and you talk to experts, it's not actually that surprising.

And you see this in a lot of industries, a lot of industries that are focused around a commodity like gold, like oil, anything like that, natural gas, silver, all these different markets.

There is a difference between how the thing itself trades and how the companies that build services for the thing itself trade.

And this is just, it's a very common feature.

And the real reason is because you have dynamics of an asset class that is, in the case of Bitcoin and cryptocurrencies, it's very volatile.

But

The dynamics of the asset class will be different from the dynamics of the company because what the companies are being bought and sold for, the stocks of them, is how well they can build a profitable service on top of this commodity.

So for an oil company, it's how profitably can you drill, extract, and sell oil.

For the cryptocurrency companies, and there are different kinds of companies.

Like I said, Silvergate is actually a bank.

Coinbase is an exchange.

And then a lot of these other companies are miners.

They're basically the ones that process Bitcoin transactions and get paid in newly minted Bitcoin.

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