Shares of Canaan (NASDAQ:CAN) jumped as much as 17.2% higher on Monday morning. The Beijing-based developer and maker of cryptocurrency mining machines didn’t have any company-specific news to share today or over the weekend, but the stock benefitted from a positive development in the crypto space.
Payment-processing giant Visa (NYSE:V) just announced that it will start to settle payments over the Ethereum (CRYPTO:ETH) network later this year. In particular, Visa’s bridge between the cryptocurrency and fiat currency worlds will rely on the Ethereum-based USD Coin (CRYPTO:USDC), whose value is pegged to the U. S. Dollar through Ethereum’s smart contracts.
Visa’s cautious step into the blockchain market is generally seen as a positive sign for the large-scale viability of cryptocurrencies and related services, driving many cryptocurrencies higher today. Ethereum is up by 4.3% at noon, EDT. Bitcoin (CRYPTO:BTC) has gained 3.2%. The USD Coin remained as stable as ever, staying within 0.1% of yesterday’s dollar value.
Canaan’s popular Avalon miners are tailor-made for Bitcoin mining, not Ethereum. The big idea here is that traditional finance powerhouses like Visa are starting to take the cryptocurrency market seriously as a whole, which should lead to increased demand for Bitcoin miners down the road.
Canaan’s shares have now gained 830% in six months, but the skyrocketing journey has not been smooth. The stock also stands 54% below the all-time highs that were set earlier this month, when Bitcoin prices topped out above $61,000 per token.
Canaan is a volatile ticker and should be treated with caution. There are many ways to invest in the Bitcoin and Ethereum markets with far lower market risk.
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