Crypto stocks are loaded with uncertainty, and if there’s one thing markets hate, it’s uncertainty. Until there’s a resolution over the debt debacle, we’ll see even more uncertainty.
All of which could be even more devastating to major indices, cryptocurrencies and crypto stocks.
More than likely, we’ll see an 11th-hour deal. Unfortunately, until that happens, a lot of investors will remain on the sidelines.
Once there’s a resolution, we’ll see a sharp rally, says JPMorgan, which should carry over into crypto stocks, including those on this list.
| MSTR | MicroStrategy | $288.28 |
| BITS | Global X Blockchain & Bitcoin Strategy ETF | $33.09 |
| BITO | Pro Shares Bitcoin Strategy ETF | $15.53 |
| NVDA | Nvidia | $312.64 |
| RIOT | Riot Platforms | $11.08 |
| MARA | Marathon Digital | $9.18 |
| SOFI | SoFi | $4.93 |
MicroStrategy (MSTR)
MicroStrategy (NASDAQ:MSTR) just bought another 1,045 Bitcoin in late March, early April for about $29.3 million in cash.
That now brings the company’s total BTC holdings to 140,000 BTC, which is worth about $3.9 billion. In short, a good deal of MSTR’s financial success is tied to BTC.
Look at recent earnings for proof. Earlier this month, MSTR posted an EPS of $31.79, as compared to a year-earlier loss of $11.58.
Its Bitcoin-buying strategy has only increased the demand for shares of MSTR along the way. If Bitcoin can eventually revisit prior highs, MSTR could offer substantial upside opportunity.
Global X Blockchain & Bitcoin Strategy ETF (BITS)
With an expense ratio of 0.65%, the Global X Blockchain & Bitcoin Strategy ETF (NASDAQ:BITS) invests in both crypto and crypto-related companies.
The last time I mentioned BITS, it traded at around $29.90 on March 26. It’s now up to $33.08 after testing an April high of $37.33.
ProShares Bitcoin Strategy ETF (BITO)
We can also look at the Pro Shares Bitcoin Strategy ETF (NYSEARCA:BITO). With an expense ratio of 0.95%, the ETF tracks the performance of spot bitcoin and was the first bitcoin-linked ETF launched in the U.S.
It is also the world’s largest and most actively traded cryptocurrency ETF, according to ProShares.
Since bottoming out around $11.50 in March, the ETF is back up to $15.46. It tested a high of $17.94 in April.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) provides the hardware to mine cryptocurrencies, which could fuel even more upside in the tech stock on a crypto recovery.
With its AI dominance, and market share in gaming, data centers, and robotics, NVDA should see strong, durable growth for years.
Oppenheimer just increased its target price on NVDA to $350 from $300. Susquehanna raised its NVDA target to $350 from $310. Truist raised its target to $322 from $289 a share.
According to Barron’s, the firms’ confidence comes from the development of new AI tools, and the growing need for AI-geared GPUs.
I’m expecting even more upside in NVDA, as we near company earnings on May 24. I also believe we’ll see a beat on the top and bottom line, with raised guidance, which could send the NVDA to higher highs. Stay tuned for that. A lot of eyeballs will be on its earnings.
Riot Platforms (RIOT)
As Bitcoin increases in value, miners like Riot Platforms (NASDAQ:RIOT) benefit. In fact, taking Bitcoin’s lead this year, RIOT exploded from about $3.30 to $11.07. From here, I’d like to see it closer to $23, which it tested in early 2022.
While the company’s first-quarter total revenue dropped to $73.2 million from $79.8 million year over year, that was to be expected. Especially when the price of Bitcoin falls 44% year over year, as well.
However, as Bitcoin regains even more lost ground, so should RIOT. Even better, in April, the company produced another 639 Bitcoin, an increase of 26% year over year. Also, as of April 30, RIOT now owns about 7,112 BTC, which carries a current value of about $191 million.
Marathon Digital (MARA)
Another mining stock to consider is Marathon Digital (NASDAQ:MARA). Along with RIOT and Bitcoin, MARA is waiting for something to happen with the debt ceiling issue.
If we can get a resolution soon, MARA could break from consolidation, with the potential to run back to $16 a share, in my opinion.
Recent earnings were okay. While it posted a net loss of $7.2 million, or five cents a share, it was better than its year-earlier loss of $12.9 million, or a 12-cent loss.
Revenues were $51.1 million, which was slightly below year-earlier revenue of $51.7 million. Unfortunately, a 74% increase in BTC production was offset by lower BTC prices in the latest quarter.
SoFi (SOFI)
SoFi (NASDAQ:SOFI) also has exposure to cryptocurrencies. Aside from crypto, there’s a lot to like here.
For one, after getting crushed over the last year, CEO Anthony Noto just bought another 1.13 million shares for about $5 million. He paid between $4.36 and $4.58 for shares between Dec. 9 and 13, 2022.
On May 4, he bought another 50,000 shares. Then, on May 5, he picked up another 30,000.
All as the SOFI stock climbs higher after the company posted respectable earnings. Just last week, SOFI beat revenue and EPS. Revenue came in at $460.16 million. EPS was a loss of five cents. Meanwhile, analysts were looking for revenue of $441 million and an EPS loss of seven cents. This is definitely one of the crypto stocks to keep your eye on.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
