With crypto winter in the process of culling some of the weaker cryptocurrencies from the herd, it’s no surprise that some people are a little concerned about trying to decide which coins and tokens will be good investments.
You can still profit from blockchain technology if you don’t want to put your money into cryptocurrencies by purchasing coins or tokens. Companies that invest in or develop blockchain technology could gain a leg up in terms of payment processing and other functions. Gaming, supply chain management and other uses for blockchain technology could potentially offer areas for companies to benefit.
Here are some ideas for investing in stocks that could benefit if blockchain technology becomes widely adopted.
Overview of the Best Cryptocurrency Stocks
Coinbase Global (COIN): One of the premier cryptocurrency exchanges, Coinbase offers access to hundreds of coins and tokens and various financial services related to the world of crypto.
Robinhood Markets (HOOD): Even though Robinhood has been embroiled in some scandals, it’s still a brokerage that also offers access to cryptocurrencies. The company makes it easy to buy and sell stocks, as well as crypto assets.
CME Group (CME): This is the world’s largest derivatives exchange. CME started offering Bitcoin futures five years ago, and its access to currencies — including cryptocurrencies — can make it an interesting choice for those who want to invest in crypto without investing in crypto.
Meta Platforms Inc (FB): The blockchain is integral to building the metaverse, which Meta is heavily investing in. If Meta truly can transition from a social media platform to a virtual and augmented reality platform built on the blockchain, it has potential.
Nvidia Corporation (NVDA): Participation in cryptocurrency mining requires high-powered graphics processing units (GPUs), and Nvidia provides those.
AMD (AMD): Another chipmaker, AMD has been working on providing the tools for better graphics that can be used in artificial intelligence and gaming.
Block (SQ): Formerly Square, Block has been at the forefront of providing payment processing solutions for Bitcoin and encouraging adoption.
PayPal Holdings (PYPL): Another payment processor, PayPal allows users to pay in cryptocurrency, and its Venmo app allows for crypto trading. Some of these players will likely do well if crypto takes off since they already have the infrastructure.
Canaan (CAN): This company designs machines specifically for mining. They are relatively low-cost and use a lower amount of energy. The specific purpose of the machines created by Canaan are also more powerful than the GPUs often used for mining.
Hut 8 Mining (HUT): This company mines Bitcoin and then lends what they get and uses it for yield farming. As a result, shareholders get a share of the profits. Hut 8 Mining is known for getting its energy from solar, wind and natural gas sources.
Shopify (SHOP): The online commerce leader helps merchants accept crypto payments. Additionally, the company provides third-party services to Facebook Shops.
1. Coinbase (COIN)
Revenue in 2022 quarter three is down 44% compared to quarter two of 2022. However, even with crypto winter putting a damper on overall revenues, Coinbase is optimistic about how it offers subscriptions and services.
If the crypto market recovers during 2023, Coinbase is poised to benefit — especially with some of its rivals like FTX imploding. Plus, the fact that Coinbase helps merchants and others accept crypto payments can be a benefit.
2. Robinhood Markets (HOOD)
Robinhood’s transaction-based revenues related to cryptocurrencies decreased 12% in the third quarter of 2022, thanks in large part to a decline in crypto. However, revenues from options and equities increased during the same period.
Because Robinhood makes it easy for traders to get involved in various assets and launched the beta version of a crypto wallet, it has promise for the future, especially as more people become interested in investing and using different types of assets.
3. CME Group (CME)
As the world’s largest financial derivatives exchange, there’s much more to CME Group than cryptocurrencies. In fact, crypto is the least of what this company does. However, because it did launch Bitcoin futures and has other products, it can be considered a cryptocurrency stock.
The company reported revenues of $1.2 billion in the third quarter of 2022. The company cites its growth in trading volume for its strong financial position. Additionally, the growth of contracts and trading from non-U.S. sources makes it an interesting play for those who want to take advantage of international finance.
4. Meta Platforms Inc (FB)
Meta has been struggling in recent months. It’s missed in its earnings projections and the company has sunk millions of dollars into its metaverse projects. However, if the metaverse does take off, and cryptocurrencies are needed for support — as well as the underlying blockchain technology — these investments could pay off in the long run.
Meta is down more than 67% in the last year, so if you think that the company will benefit from the rise of crypto in the future, now might be a good time to grab a bargain.
5. Nvidia Corporation (NVDA)
Like many other tech-related companies, Nvidia isn’t doing so hot as the market crashes and people worry about a coming recession. However, if cryptocurrencies recover, the chip maker could also see a recovery. In 2020 and 2021, the company saw a spike as more people ordered Nvidia products to mine cryptocurrency. Now that NVDA has dropped from its highs in 2021, it could be a decent time to get a bargain.
6. AMD (AMD)
Even though results for the third quarter of 2022 were soft for AMD, the company still saw more than $5 billion revenues. Concerns about supply chains and the overall personal computer market are weighing on the company. However, AMD is still reporting a 29% year-over-year increase in revenue.
In February 2022, AMD bought out Xilinx, which makes programmable chips. If blockchain technology grows, companies like AMD that offer various solutions will likely benefit.
7. Block (SQ)
For quarter three of 2022, Block beat expectations set by Wall Street. Some of the gains were driven by Cash App, which Block owns. Cash App saw a year-over-year increase of 51% in revenues. Cash App makes it easy to send cryptocurrencies and cash to peers.
Concerns about payment processors are rising as worries about an economic slowdown persist. Additionally, the margins on Bitcoin sales are small, so crypto might not be a huge money-maker for Block in the future. However, the fact that it’s possible could provide Block with support.
8. PayPal (PYPL)
Even though PayPal beat estimates for Q3 of 2022, the company has still been struggling. Revenue forecasts aren’t great as we head into the end of the year.
However, PayPal still offers cryptocurrency payment options, as well as provides the ability to buy and sell certain cryptos with Venmo. Because of its infrastructure, PayPal stands to continue to benefit as long as it offers crypto payment options for merchants and consumers.
PYPL is down more than 57% year-over-year, meaning that it could be a good buy at its current price.
9. Canaan (CAN)
Revenues of Canaan plunged in the third quarter of 2022. As a result, the company’s share price is lower. The company says it will continue to put money into its projects. The fact that it produces machines specifically aimed at mining crypto could help it in the future — especially if cryptocurrencies recover. However, if a lot of cryptocurrencies move to proof of stake, it might be harder for Canaan to market its products. This might be a solid choice for a low-cost experiment to see if it can work for your portfolio.
10. Hut 8 Mining (HUT)
This is another small and potentially interesting cryptocurrency stock for a portfolio. The company uses its network to mine bitcoins, and it was successful in mining 982 bitcoin in the third quarter of 2022. Additionally, the company says generated $4.4 million in revenue during the quarter, with much of it being recurring monthly revenue.
As of this writing, HUT has a share price below $2. If you think a model built on revenues through lending and yield farming could be interesting — without you doing the heavy lifting — this can be an interesting play.
11. Shopify (SHOP)
Shopify reported increased revenues year-over-year, including a monthly recurring revenue boost of 8%. Shopify is pushing its subscriptions and pointing out that it is launching new tools that make it easier to collaborate as well as sell globally.
Shopify also helps merchants accept cryptocurrencies as payments through its partnership with CoinPayments. If crypto does become more widely used, a platform like Shopify can be a good choice because it allows more options.
Cryptocurrencies and blockchain technology might never reach critical mass. However, there’s still the possibility that some form of digital or crypto infrastructure is needed. In that case, companies that have taken advantage of this promise will likely come out on top.
If you’re interested in investing in stocks that have promise if cryptocurrencies recover from the current winter, these can be good choices. However, you need to be careful. Only risk money you can afford to lose and make sure to limit your portfolio exposure.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.