Cryptocurrency stocks have rebounded after recent outflows amid low market sentiment. Inflows have reversed losses this week despite the overall market decline, coinciding with trends in crypto and the broader equity markets. These blockchain-related stocks, closely tied to Bitcoin (BTC-USD), altcoins and blockchain developments, have outperformed despite mid-week volatility.
But these stocks also certainly reflect lingering negative sentiment, with the overall cryptocurrency sector’s market capitalization sitting at just $2.26 trillion, down significantly from its recent peak of more than $3 trillion.
That said, amid a surge in innovation, many investors are prioritizing promising blockchain stocks. These three stocks stand out for their current value and potential growth, which could also impact Ethereum (ETH-USD), especially after Bitcoin’s halving and spot ETF approval.
Coinbase (COIN)
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Investors looking for high returns and exposure to cryptocurrencies may want to consider investing in Coinbase Global (NASDAQ:COIN) . The cryptocurrency exchange reported first-quarter revenue that beat expectations by a wide margin, with EPS of $4.40, up 303% from analysts’ expectations of $1.09.
Revenue reached $1.64 billion, beating Wall Street’s expectations of $1.34 billion, as Bitcoin and digital asset trading hit record highs. Last year, Coinbase posted a loss of $78.9 million. Coinbase is up 263% in 2023, making it one of the market’s best-performing stocks.
Consumer transactions doubled to $935 million, while institutional transactions increased 133% to $85 million. Coinbase Prime has seen a huge increase in trading volume, outperforming the U.S. spot market, and it also has plans for international expansion and regulatory adaptation.
Marathon Digital (MARA)
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Marathon Digital (NASDAQ:MARA), best known for Bitcoin (BTC) mining, has expanded into Kaspar (KAS), a PoW-based cryptocurrency, in an effort to diversify revenue. Leveraging existing infrastructure and partnerships, Marathon has mined 93 million KAS by June 25, valued at approximately $15 million. Adam Swick, Marathon’s Chief Growth Officer, highlighted this as a strategic move to bolster revenue from digital asset computing.
The company’s shares have risen 64% over the past year and are expected to rise further, and its expansion plans, combined with a bullish outlook for Bitcoin, suggest that its hashrate capacity could grow significantly in the future.
MARA is poised for growth, reporting strong first quarter results with revenue increasing 223% year over year to $165.2 million and net profit increasing 184% year over year to $337.2 million. MARA strengthened its market position by increasing its BTC issuance by 28% to 2,811 coins and its hash rate by 142% to 27.8 exahashes/second.
MicroStrategy (MSTR)
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MicroStrategy (NASDAQ:MSTR), led by Chairman Michael Saylor, added 11,931 BTC at a cost of $786 million, increasing its Bitcoin holdings to 226,331 and its value to $15 billion. The move follows an $800 million convertible note offering to institutional investors. The software company has transformed into a significant industry player under Saylor’s leadership.
MicroStrategy’s shift to AI-driven cloud services fueled growth in 2023, with cloud subscription revenue growing 33.6% to $81 million. Despite declines elsewhere, margin expansion in the cloud segment highlights the company’s profitability amid growing adoption across the industry.
MicroStrategy’s unique strategy is to leverage debt and equity to maximize returns from Bitcoin investments and take advantage of recent favorable market trends. In related news, MicroStrategy has upgraded HyperIntelligence with a chat interface for querying business data via natural language across web applications, which includes generative AI integration to provide instant access to detailed insights through browser pop-up cards and direct BI system queries with Auto.
On the date of publication, Chris McDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author in accordance with InvestorPlace.com’s Publishing Guidelines.
On the date of publication, the editor in charge did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
His passion for investing led Chris McDonald to earn an MBA in Finance and hold a number of management positions in Corporate Finance and Venture Capital over the past 15 years. His previous experience working as a financial analyst and passion for finding undervalued growth opportunities has led to his conservative, long-term investment view.
