2023 proved to be an immensely profitable year for Bitcoin. The cryptocurrency soared by 174% since the beginning of the year. During this journey, companies closely linked to Bitcoin also experienced notable increases in their stock prices. This situation particularly caused significant losses for investors holding short positions in public crypto companies like Coinbase, MicroStrategy, and Marathon Digital Holdings.
According to a report dated December 5th by S3 Partners, investors with short positions in these companies are currently facing a total loss of $6.05 billion. A major portion of these losses occurred in the last three months. Notably, with the stock prices of Coinbase and Marathon Digital soaring by approximately 400% since the start of the year, those who sought short positions in these stocks suffered severe losses.
Since the end of October, buy-to-close transactions in companies such as Coinbase Global, MicroStrategy, Marathon Digital Holdings, and Riot Platforms have further driven up their stock prices.
“Buying-to-cover in the most shorted crypto stocks such as Coinbase Global, MicroStrategy, Marathon Digital Holdings, and Riot Platforms will help push stock prices higher along with the long buying that has driven up stock prices since the end of October.”S3 Partners Report.
In short, this rise in cryptocurrencies has significantly affected not only altcoins and their derivatives but also the market values of companies investing in this field.