Cryptocurrencies continue to rally, fueled by multiple catalysts. The approval of spot Bitcoin (BTC-USD) exchange-traded funds (ETFs) in January has been a huge spark for the entire industry. Lower interest rates, an upcoming halving event for Bitcoin in April, and the potential approval of Ethereum (ETH-USD) spot ETFs by this summer are all expected to add tailwinds to cryptocurrencies and keep the current rally going. With Bitcoin having recently hit an all-time high of $69,202, many analysts and market observers are now predicting that Bitcoin’s price will top $150,000 by year’s end. Big gains are forecast for smaller cryptocurrencies, including ETH. Here are three stocks to buy as a new crypto rally emerges.
MicroStrategy (MSTR)
Not only has MicroStrategy (NASDAQ:MSTR) amassed a Bitcoin stake worth $13 billion, more than any other company. It’s now raising $600 million so that it can buy even more BTC. In late February, MicroStrategy disclosed that it bought 3,000 additional Bitcoins, taking its total holding to 193,000 of the digital tokens. MicroStrategy is now the world’s largest owner of Bitcoin or any cryptocurrency for that matter.
MicroStrategy first began buying Bitcoin in 2020 as revenue from its software business began to decline. Saylor has said that MicroStrategy’s average purchase price of Bitcoin is $31,544, putting the value of the stake at more than $13 billion based on current prices. While MicroStrategy is still technically a software firm, its share price now moves largely in tandem with the price of Bitcoin. MSTR stock is up 576% in the last 12 months.
Block (SQ)
Block (NYSE:SQ) CEO Jack Dorsey is also a big fan of cryptocurrencies. He changed the company’s name to Block to reflect its increasing focus on crypto and its underlying blockchain. While not as large a stake as MicroStrategy, Block still has a sizable holding of Bitcoin. At the end of 2023, the digital payments firm held 8,038 Bitcoin, which is currently valued at $544.17 million.
While Block continues to operate its popular Cash App banking platform, the company is increasingly focused on cryptocurrencies. Recently, Block reported a surprise quarterly profit due largely to a $207 million gain in its holdings of BTC. The company also said that it made $66 million in profit on Bitcoin sales in the final quarter of 2023, which was a 90% increase from a year earlier. SQ stock is currently up by 12% year to date.
Coinbase Global (COIN)
Trading volumes in cryptocurrencies are soaring, and that’s good news for Coinbase Global (NASDAQ:COIN), the biggest crypto exchange in the U.S. Coinbase has been doing so well from the surge in crypto trading that it recently reported its first profit in two years. Coinbase announced fourth quarter 2023 earnings per share (EPS) of $1.04 compared to 27 cents that was forecast. It was the first profit since Q4 2021.
Coinbase also reported that its revenue rose 58% year-over-year to $953.80 million, ahead of expectations for $818.36 million. Trading revenue from investors on Coinbase’s exchange increased 79% between the third and fourth quarters of last year. The company said interest in crypto has only intensified since the U.S. Securities and Exchange Commission (SEC) approved spot Bitcoin exchange-traded funds (ETFs) in January.
COIN stock has gained more than 300% over the last 12 months.
On the date of publication, Joel Baglole did not have (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.