President Trump’s election victory is leading to a buying frenzy in the cryptocurrency markets. Bitcoin (CRYPTO:BTC) is soaring in value and hit its highest price ever of more than $75,000. That bodes well for bitcoin miner Riot Platforms (NASDAQ:RIOT), which is also soaring after Trump’s victory. Trump has said he wants all bitcoin to be mined in the U.S. He told supporters in July, “If crypto is going to define the future, I want it to be mined, minted and made in the USA.”

He also wants to halt what he calls the Biden administration’s “anti-crypto crusade.” He has criticized the head of the Securities & Exchange Commission Gary Gensler, a target of the crypto industry’s ire for perceived overreach.

Riot Platforms, though, has been a terrible investment and even after today’s gains shares are still down 23% for the year. But if a Trump presidency brings about changes and support for the crypto industry, can RIOT stock double from here?

24/7 Wall St. Insights:

• The election victory by Donald Trump sent cryptocurrency-related stocks soaring, including miner Riot Platforms (RIOT), which shot 25% higher.
• Although Riot is a low-cost miner, it still produces significant losses and could be hard-pressed to see its shares grow.
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Digging for fool’s gold

Riot has been through several iterations in its public life. While crypto mining had been hot niche at one time when mining stocks were seen as a relatively risk-free way for investors to get exposure to Bitcoin’s price, the mania surrounding them cooled off. 

Narrowing profit margins turned investors off to mining operations making being an infrastructure play for the industry unattractive. Riot subsequently rebranded itself Riot Platforms from Riot Blockchain. 

Its stock peaked at $44 a share in 2021 and it has been a long slide slower since. RIOT stock closed under $10 a share yesterday, a 78% loss of value. But with shares 25% higher today, it wouldn’t take much for it to double. Still, the prospect that it can hit $20 a stub let alone $24 seems a stretch.

Tough times ahead

The miner suffered from weak sales and saw losses badly miss expectations. Riot reported losses of $154.4 million in the third quarter, nearly double the year-ago figure. So despite being a low-cost miner, it hasn’t been enough to translate into profits and stop its slide.

It has also underperformed Bitcoin itself. While the two are rising in tandem today, the cryptocurrency has handily outperformed the mining stock.

A Trump presidency promises a better regulatory environment for cryptocurrency stocks, and could position the U.S. as a premiere location to mine bitcoin. As a candidate he pledged to make the country the “crypto capital of the planet” and create a “strategic reserve” of bitcoin. Unfortunately, once the euphoria of the election victory wears off, investors should expect Riot Platforms stock to return to form.

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