Bitcoin Mining Stocks: A Hidden Bargain or Value Trap? On-Chain Data Drops Clues
Wall Street’s still pricing Bitcoin miners like it’s 2022—while on-chain metrics scream opportunity. Here’s what the blockchain doesn’t lie about.
Hash rate vs. stock prices: The glaring disconnect
Miners’ rigs are humming at record efficiency, yet their stocks trade at fire-sale multiples. Either the market’s asleep, or it knows something your Twitter feed won’t admit.
When the blockchain ledger speaks louder than earnings calls
Transaction fees, wallet movements, and energy costs don’t do corporate spin. The data shows miners accumulating—not dumping—despite what the shorts claim.
The cynical take: Maybe hedge funds want retail to panic-sell before the halving rally. Again.
The Valuation Methodology
The Bitcoin mining companies monitored through CryptoQuant’s framework include Marathon Digital (MARA), Riot Blockchain (RIOT), and Core Scientific (CORZ). The analytics firm also tracked the revenue metrics of Hive Digital Technologies (HIVE), CleanSpark (CLSK), Bitfarms (BITF), TeraWulf Inc. (WULF), Cipher Mining (CIPHER), and IREN (IREN), formerly Iris Energy.
According to the report, CryptoQuant analysts estimated daily mining revenues directly from block rewards and transaction fees by tracking miner addresses. The revenue estimates are annualized and compared to the mining firms’ market cap. From there, the analysts offer a forward-looking valuation framework similar to a price-to-sales ratio. CryptoQuant calls this the Market Cap to Annualized Daily Revenues (MCAR) ratio.
The MCAR ratio tells whether a miner’s underlying Bitcoin production or USD-denominated revenue supports the company’s valuation.
“By comparing each company’s market capitalization to its annualized revenue on a daily basis, investors can identify which firms are potentially overvalued or undervalued. This enables more informed portfolio allocation—favoring companies whose market valuations lag behind their revenue generation while reducing exposure to those trading at excessive premiums,” CryptoQuant stated.
WULF and MARA Valued at Relative Premiums
From CryptoQuant’s analysis, the MCAR ratios for WULF, MARA, RIOT, CLSK, HIVE, and IREN are 5.1, 4.4, 3.7, 3.3, 1.9, and 1.8, respectively. These numbers reflect how much investors pay for every dollar of estimated annual revenue in real time.
WULF and MARA have the highest valuation multiples, so CryptoQuant believes they are priced at a significant premium compared to the other firms. RIOT, CLSK, and HIVE are not as overvalued, so their market valuations hover within the same range as their revenue generation.
CryptoQuant found that IREN has the lowest valuation despite posting strong growth in its BTC production. This suggests that the company is likely undervalued by the market. On the brighter side, the firm faces a potential upside if it becomes repriced in the market.
“The current valuation dispersion opens opportunities for relative value strategies by identifying firms like IREN that may be lagging in market recognition despite solid operational performance,” the analytics firm added.
