Short squeeze sends crypto-related stocks higher
Shares of companies in the crypto-currency space are flying in afternoon trading after bitcoin jumped to a two week high. According to a Reuters report, cryptocurrencies jumped on a short squeeze as there is "no obvious news" in the space. Charles Hayter, the founder of cryptocurrency analysis website CryptoCompare, said, "People overshooting on Bitfinex so a bit of a squeeze there." Bitfinex is a full-featured spot trading platform for the major cryptocurrencies such as Bitcoin (BITCOIN) , Ethereum, EOS, Litecoin, Ripple, Bitcoin Cash, Iota, NEO and Ethereum Classic, according to a description on its website. HEDGEFUND LEGENDS IN CRYPTOS: According to reports out last week, mega-investor George Soros is planning to start trading cryptocurrencies. In a speech at the World Economic Forum in Davos in January, Soros said that despite cryptocurrency being in a "typical bubble," he believes that the structure of blockchain technology could be put to "positive use." Additionally, Michael Novogratz, the former Fortress Investment Group manager, said in a CNBC interview in October that he has "been investing in bitcoin and its underlying blockchain technology for a while and sees bitcoin's price rising to over $10,000 in the next six to 10 months." HEIGHTENED NEGATIVITY: Yesterday, a Bloomberg article highlighted the growing skepticism around cryptocurrencies. "As Bitcoin streaked toward a record high in December, a rash of firms that had little or no experience with cryptocurrencies or blockchain technology used the buzzwords as an antidote for lackluster stock returns," according to the April 11 report. Bloomberg noted that the shares of Long Blockchain (LBCC) and Longfin (LFIN), "whose shares skyrocketed last year after they rebranded as blockchain businesses," are facing exchange scrutiny. JOHN MCAFEE ENDORSEMENT: John McAfee, the legendary and enigmatic founder of cybersecurity firm McAfee Associates, who joined in the crypto gravy train with his involvement in MGT Capital (MGTI), said in an interview in 2016, "I don't know if it will be Bitcoin or multiples (of different currencies) but there will be a cryptocurrency standard for the world whether governments like it or not." Earlier this year, McAfee, a former Libertarian presidential candidate, stepped down from his leadership position at MGTI. PRICE ACTION: Shares of companies with exposure to crypto are up dramatically with Net Element (NETE) are up about 14%, while Marathon Patent Group (MARA) is up 25%. Chip giants with crypto exposure, NVIDIA (NVDA )and Advanced Micro Devices (AMD) are up 3.3% and 2.2%, respectively. OTHERS TO WATCH: Shares of other companies with crypto exposure are also up, including Riot Blockchain (RIOT), Overstock.com, (OSTK), CYREN (CYRN) and Eastman Kodak Company (KODK).