Blockchain technology is being adopted by many of the best-known stocks and firms. At its core, the blockchain is simply a publicly distributed digital ledger allowing the recording of transactions in an unalterable way. The technology is fundamentally associated with the emergence of cryptocurrency — a polarizing market in general.
However, blockchain promises to increase security and that means firms of every stripe are seeking to adapt it to their business models. The sector is expected to grow at annual rates above 66% between 2022 and 2027, suggesting market size could double every two years. Thus, firms quickest to adopt the technology stand to gain the most. Here are the best blockchain stocks to consider.
Visa (V)
Visa (NYSE:V) is one of the best-known credit card firms globally, with a stock worth considering for its many merits. The company has entrenched its business in the world of cryptocurrency. Thus, beyond its fundamentally strong business practices, investors should also consider the stock for its blockchain-based growth potential.
Visa has connected its payments business to crypto and blockchain networks. The company partnered with more than 65 wallets to enable payment. Visa continues to develop native digital currency settlement on card networks. That means Visa customers and merchants will be increasingly able to use Bitcoin (BTC-USD), for example, with its cards. Generally speaking, Visa continues to invest in blockchain tech. That should be a strong signal to the masses that cryptocurrency is more than a passing fad. It’s time to look past the scams and understand there is much more to the sector.
Visa, as one of the most stable firms in the space, is a prime investment to consider. It won’t produce spectacular overnight returns in relation to the blockchain, but that’s not what investing is about.
Mastercard (MA)
Mastercard (NYSE:MA), like Visa, is undertaking real efforts to adapt blockchain tech into the stock.
Before discussing those efforts, let’s first take a quick look at Mastercard as a general investment since that’s ultimately what matters. It’s certainly compelling in that regard. Both Mastercard and Visa are undergoing strong growth. Revenues increased by 14%, while net income increased by 25% in the second quarter. Credit card use is rising, which benefits Mastercard in general, making its stock a clear choice for investors.
That aside, let’s get back to the blockchain opportunity as it pertains to Mastercard. The company is focused on building a blockchain hub with it at the center. Mastercard’s Multi-Token Network (MTN) focuses on security, scalability and interoperability between blockchain ecosystems. It’s easy to imagine Mastercard placing its business at an intermediary position therein and collecting transaction fees along the way.
That’s exactly what Mastercard already does in the world of fiat currency. It makes every bit of sense that the company has the technical know-how to create a similar system in the crypto space.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) and its stock have enjoyed a meteoric rise in 2023 on the emergence of generative AI. The company has not disappointed in that regard. Its second-quarter revenues of $13.5 billion simultaneously blew expectations away and proved that AI demand is not waning. That’s the main narrative surrounding Nvidia.
However, the company is also deeply entrenched in the cryptocurrency and blockchain space — somewhat reluctantly. While Nvidia’s chips remain in high demand for blockchain mining purposes, the company has also publicly stated that crypto does not “bring anything useful for society.” The business would rather its chips go toward AI purposes. My guess is that Nvidia believes more in AI revenue potential than it does in the notion that blockchain is useless.
Regardless, Nvidia is in demand in the blockchain space and remains the best investment of 2023 thus far. Whether for AI or blockchain, its chips benefit from massive demand, which is likely to continue propelling shares upward in price.
On the date of publication, Alex Sirois 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 writer, subject to the InvestorPlace.com Publishing Guidelines.