The Bitcoin Bull Rides Again (SQ, OSTK, ISWH, BTBT)

Call it a classic Turnaround Tuesday – traders and investors came storming back into risk assets on Tuesday, driving technology shares, gold, junk debt, growth stocks, and Bitcoin back higher in a tsunami of buying.

Cathie Wood’s Ark empire was a big beneficiary, along with Tesla (TSLA) shares and GameStop (GME). But Bitcoin may have been the most central given its core role in the animal spirits defining the recent stage of the bull market.

From a technical perspective, Bitcoin has repeatedly held its key trendline and maintained a constructive bullish trending posture. With no clear means of assigning any valuation standards, the trend is the dominant factor in a world where cryptocurrency adoption and the increasing legitimacy of Bitcoin as a store of value and payment mechanism continue to outperform expectations.

As such, we take a look here at some of the stocks poised to benefit from continued interest in the crypto bull trend, including: Square Inc (NYSE:SQ), Inc (NASDAQ:OSTK), ISW Holdings Ord Shs (OTCMKTS:ISWH), and Bit Digital Inc (NASDAQ:BTBT).

Square Inc (NYSE:SQ) bill itself as a company that provides payment and point-of-sale solutions in the United States and internationally. The company’s commerce ecosystem includes point-of-sale software and hardware that enables sellers to turn mobile and computing devices into payment and point-of-sale solutions.

It offers hardware products, including Magstripe reader, which enables swiped transactions of magnetic stripe cards; Contactless and chip reader that accepts Europay, MasterCard, and Visa (EMV) chip cards and Near Field Communication payments; Chip card reader, which accepts EMV chip cards and enables swiped transactions of magnetic stripe cards; Square Stand, which enables an iPad to be used as a payment terminal or full point of sale solution; and Square Register that combines its hardware, point-of-sale software, and payments technology, as well as managed payments solutions.

Square Inc (NYSE:SQ) made big headlines back in October when it announced that it had purchased approximately 4,709 bitcoins at an aggregate purchase price of $50 million. Bitcoin was trading at just over $10k at the time, and it has already nearly doubled.

According to the company, Square believes that cryptocurrency is an instrument of economic empowerment and provides a way for the world to participate in a global monetary system, which aligns with the company’s purpose. The investment represents approximately one percent of Square’s total assets as of the end of the second quarter of 2020.

Even in light of this news, SQ has had a rough past week of trading action, with shares sinking something like -11% in that time. That said, chart support is nearby, and we may be in the process of constructing a nice setup for some movement back the other way.

Square Inc (NYSE:SQ) pulled in sales of $3.2B in its last reported quarterly financials, representing top line growth of 140.5%. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($3.9B against $4.1B, respectively). Inc (NASDAQ:OSTK) bills itself as a an online retailer and technology company based in Salt Lake City, Utah. The stock has become a mainstay among crypto traders given its partnerships and investments in the space.

In addition, it’s also-ran e-commerce website sells a broad range of new products at low prices, including furniture, décor, rugs, bedding, home improvement, jewelry, and more. The online shopping site, which is visited by nearly 40 million customers a month, also features a marketplace providing customers access to millions of products from third-party sellers. Inc (NASDAQ:OSTK) recently announced, via its tzero segment, a technology integration with Tokensoft subsidiary, Tokensoft Transfer Agent, an SEC-registered transfer agent, to support issuers using Tokensoft’s digitization and transfer agent services.

Following the integration, Tokensoft’s digital security technology will be interoperable with tZERO’s secondary trading technology, allowing securities of issuers utilizing Tokensoft’s services to seamlessly onboard and trade on the tZERO ATS, an alternative trading system (ATS) that is operated by tZERO ATS, a FINRA member broker-dealer, subject to tZERO ATS’s trading terms and due diligence.

It will be interesting to see if the stock can break out of its recent sideways action. Over the past week, the stock is net flat, and looking for something new to spark things. Over the past month, shares of the stock have suffered from clear selling pressure, dropping by roughly -32%. Inc (NASDAQ:OSTK) pulled in sales of $684M in its last reported quarterly financials, representing top line growth of 84.4%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($520.9M against $327.6M).

ISW Holdings Ord Shs (OTCMKTS:ISWH) is an emerging play in the crypto and telehealth markets, and has been piling up catalysts this year, with a strong trend in expansion and share appreciation to show for its efforts. The company is now active as a miner and a mining equipment producer, with its Proceso POD5IVE Datacenter mining solution.

Designed in partnership with Bit5ive, and geared primarily for the cryptocurrency mining industry, the Pod5 Datacenter offers next-generation dynamic self-management functionality, plug-and-play operation, virtually non-existent maintenance needs, and an industry best-in-class 1.06 Power Usage Effectiveness score.

ISW Holdings Inc (OTCMKTS:ISWH) recently announced that the Company has paid off and cancelled a major convertible debt note by allocating $363k to settle the outstanding obligation and remove it from the books. That announcement follows the Company’s recent moves to energize its initial POD5IVE crypto mining unit and to acquire the means to assemble and energize two additional mining pods, each powering full-scale mining operations involving hundreds of high-performance mining rigs.

“As our financial reality has shifted over recent months, we have an opportunity to drive value for our shareholders in many ways, including eradicating dilution risk by being proactive in addressing outstanding liabilities,” noted Alonzo Pierce, President and Chairman of ISW Holdings. “Without this action, the note would have had the potential to convert at a 50% discount to current share pricing. We weren’t comfortable with that potential outcome, so we deployed capital to eliminate that risk.”

Pierce added, “This is just the beginning on so many levels, and we will continue to protect our shareholders and advance their interests around every corner. We are approaching every decision from the perspective of driving long-term value. We have a number of very exciting announcements coming as we continue to expand operations at a rapid rate, but we know that none of this would be possible without the steady strong-handed support of our valued shareholders.”

ISW Holdings Ord Shs (OTCMKTS:ISWH) has demonstrated strong growth, with seven consecutive quarters of sharp sequential growth. Its most recent quarter put the company on an annual run-rate to pull in more than $1.5 million in revenues not counting what appears to be significant growth brewing in its crypto mining and mining equipment segment over coming months as it continues to scale up operations.

Bit Digital Inc (NASDAQ:BTBT) trumpets itself as the Bitcoin company dedicated to integrating resources globally for bitcoin and bitcoin mining.

It commenced bitcoin mining in early 2020 and currently operates 2,253.5 PH/S of Bitcoin Hash Rate across the entire Bitcoin network, making it one of the largest bitcoin mining companies listed on NASDAQ.

Bit Digital Inc (NASDAQ:BTBT) most recently announced its unaudited Bitcoin production data for the month ended January 31, 2021. During the month, the company earned 424.7 bitcoins, accounting for approximately $14.8 million in revenue. As of January 31, 2021, the company held 488.5 bitcoins in treasury, versus 262.6 bitcoins as of December 31, 2021.

“Bit Digital plans to release production reports to support key milestones on a regular basis,” shared interim CEO and CFO Erke Huang. “We believe in our leadership position within the mining sector, and will strive to protect both our brand’s reputation and our stakeholders’ interests in Bit Digital.”

It will be interesting to see if the stock can break out of its recent sideways action. Over the past week, the stock is net flat, and looking for something new to spark things. Bit Digital Inc (NASDAQ:BTBT) recently announced revenues from bitcoin mining business was $7.91 million for the quarter ended in December 2020. In that same report, the company noted that the number of bitcoins earned from bitcoin mining business was 739.51. The net loss from discontinued operations was $0.10 million on net income of $54 and earnings per share of $0.00, compared with the net loss of $3.0 million and loss per share of $0.20 for the same period last year.

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