Cryptocurrencies have their ups and downs, but blockchain stocks offer the potential for big gains over the long term. Blockchain is primarily known as the driving force behind cryptocurrency trading, but the technology’s uses go beyond that.
Simply put, blockchain platforms allow users to store data and initiate peer-to-peer transactions. The technology has revolutionized industries such as finance and real estate by ensuring the security of transactions in a decentralized environment. This has brought about a paradigm shift in how data is owned and managed while redefining traditional business models.
Given the immense potential of blockchain technology, many companies are investing heavily in this field. Some have made blockchain the core of their daily operations, while others offer blockchain-related services. According to data from Fortune Business Insights, the global blockchain market is expected to grow from $27.84 billion in 2024 to $825.93 billion by 2032, representing a compound annual growth rate (CAGR) of 52.8%.
In other words, investing in blockchain-related companies could prove to be a worthwhile endeavor that could yield market-busting returns. With that in mind, let’s take a look at three companies that are making waves in the blockchain space.
Coinbase (COIN)
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Coinbase (NASDAQ:COIN), the world’s largest cryptocurrency exchange, is benefiting greatly from the growth of blockchain technology. The company initiated approximately 312 billion transactions in the first quarter and boasts a user base of 110 million people across 100 countries.
The success of the company’s platform was evident in its recent earnings report. Coinbase far exceeded analyst expectations, with total revenue growing 72% year over year to $1.6 billion. This growth was driven in large part by institutional trading revenue, which increased 133% year over year.
Behind the impressive financials lies an interesting new venture for Coinbase in the blockchain space: a platform called Base. Base is a Layer 2 platform built on top of Ethereum (Layer 1). This second layer tracks individual transactions and posts them to the Ethereum network in batches. Performing transactions in batches rather than individually makes the process more cost and energy efficient.
Base currently accounts for around 5% of total revenue, but this new technology has the potential to generate significant benefits while improving user experience.
If you’re looking to bet on the future of blockchain, COIN is one of the best blockchain stocks on the market right now.
MasterCard (MA)
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The shift to a cashless economy has been a boon for payment processing leader Mastercard (NYSE:MA). The company’s core business is facilitating transactions between merchant banks and financial institutions. While the emergence of blockchain technology could have been seen as a potential threat to the company’s market share, Mastercard was quick to adopt the technology to enhance its services.
A core element of Mastercard’s blockchain strategy is the Multi-Token Network (MTN), a blockchain-powered platform that enables users to safely and securely trade digital assets through tokenization – tokens are essentially virtual representations of current and savings accounts.
In addition to this, the network will enable app developers to build the next generation of De-Fi apps. Several companies, such as Coadjute and Pairpoint, are already using the platform’s services. Mastercard is also actively looking to integrate financial institutions into MTN to make the solution more attractive to app developers. After several months of beta testing, the application is now a testbed for payments and commerce functionality in select countries.
Mastercard’s blockchain business has a lot of potential for the long term, plus its strong position in the payments space makes it one of the best blockchain stocks on the market.
Block (SQ)
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Formerly known as Square, The Block (NYSE:SQ)’s new name expresses the company’s thoughts on blockchain more clearly than any other. The company is investing in multiple Bitcoin (BTC-USD) initiatives that are based on blockchain technology across the ecosystem. The Block’s core payments platform, Cash App, utilizes blockchain to power cryptocurrency transactions. The platform has 57 million monthly active users and accounts for 60% of The Block’s profits.
Some of the company’s notable bitcoin-related efforts include Bitkey, a self-custodial bitcoin wallet that connects Cash App to Coinbase to enable cryptocurrency transactions on the app. To further innovate in the space, Block launched TBD, a developer platform for building decentralized apps on the blockchain. The company also plans to reinvest 10% of BTC revenue back into the company.
The success of BlockC’s blockchain and bitcoin efforts is backed up by the company’s impressive financials: first-quarter revenue was up 19% year over year, and full-year profits are expected to grow 17% year over year.
As blockchain technology goes mainstream, SQ is undoubtedly one of the best blockchain stocks to buy for long-term gains.
As of the date of publication, Divya Premkumar 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 and are subject to InvestorPlace.com’s Publication 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.
Divya has a background in finance and accounting and has held FP&A roles in Fortune 500 companies. She is an avid reader and enjoys writing on a variety of topics including equities, cryptocurrency, blockchain and international policy.
