The stock market has faced relentless selling pressure lately due to concerns over aggressive interest rate hikes by the Federal Reserve to tame surging inflation and the possibility of a recession. Although some cryptocurrencies, especially Bitcoin, have often been tipped to be a good inflation hedge, crypto prices have also plunged.

The correction in the cryptocurrency market has sparked panic among investors. The crypto mining stocks, which are often used as a proxy play for cryptocurrencies by investors, also bore the brunt of the downtrend in risky assets. Chief Investment Officer of Valkyrie Investments Steven McClurg said, “Crypto and equity markets are largely selling off in tandem due to a broad risk-off environment where many investors are moving to cash.”

Stablecoins, which are pegged to the value of a currency or any commodity like gold, also crashed during the recent market correction. The stable coin TerraUSD, or UST, which is supposed to mirror the value of the U.S. dollar, plummeted to 11 cents yesterday. The decline put pressure on popular cryptocurrencies and erased the value of TerraUSD’s sister token, Luna. Also, cryptocurrency exchange Coinbase Global, Inc. (COIN) collapsed after reporting a quarterly loss of $430 million and a 19% drop in monthly users. Along with bitcoin and other cryptocurrencies, the cryptocurrency mining stocks were badly hit during the recent market correction after their rally late last year due to the ban on crypto mining in China.

These negative developments are expected to keep cryptocurrencies and crypto mining stocks under pressure. Although these stocks have corrected from their peaks, it may not be wise to buy the dip in them.

Today I’m going to analyze why cryptocurrency mining stocks Riot Blockchain,…