Cathie Wood likes to think big.

The family of Ark Invest exchange-traded funds (ETFs) are chock full of stocks the investing guru believes can transform the market. For example, she recently reiterated her bold prediction that Bitcoin (BTC-USD) will be worth $1.5 million by 2030. And, Wood just updated her already seemingly outlandish call for Tesla (NASDAQ:TSLA) by saying she thinks it will go to $3,000 by 2025. A best-case scenario could see the electric car maker hitting $4,000 by then!

Wood is definitely fearless when it comes to making calls and then acting on them. Her ETFs contain of some of the most disruptive technologies available. From artificial intelligence (AI) and electric vertical takeoff and landing (eVTOL) aircraft to EVs and blockchain technology, they are part of what Wood calls a “technological convergence (that) could create techtonic macroeconomic shifts more impactful that the first and second industrial revolutions.”  

So, when her Big Ideas 2024 report took notice of several digital wallet stocks, so did I. Let’s delve into three of the best stocks to buy in the space to capitalize on what Wood believes can be a $50 billion opportunity.

Block (SQ)

As much as Wood loves Bitcoin, Block‘s (NYSE:SQ) sojourn into the cryptocurrency derailed the fintech stock’s growth and operations. Because SQ was founded as a company dedicated to helping merchants process payments, this detour added a whole new level of volatility. Additionally, it created confusion as the company changed its name from Square to Block to represent its embrace of crypto. Block’s stock suffered as a consequence.

From Block’s IPO to the end of 2021 when it changed its name, SQ stock returned around 1,400% for investors. From then on, shares have lost 60% of their value. It’s not all because of the name change, but it does reflect the loss of focus. Now, Block is looking to change again. It’s not abandoning crypto. But it is refocusing on its two core services: helping merchants and its money transfer platform Cash App.

The Square sellers segment continues to expand, growing at double-digit rates last year. And, Cash App is transitioning into a closed-loop ecosystem for a user’s financial needs. Not only is it a peer-to-peer cash transfer system, but also Cash App is increasingly becoming a full banking solution. 

Some two million users deposit their paychecks using Cash App. Yet, Block wants the majority of its 56 million monthly users to see the platform as a complete financial tool. It’s a lofty goal, but it will run into much tougher and experienced competition. For example, SoFi Technologies (NASDAQ:SOFI) is already seeking to be the one-stop shop for a family’s finances.

Furthermore, Wood is a big believer in the fintech, owning over 12 million shares. Also, SQ is up 75% off its November lows. Future growth, however, will likely come more slowly. 

Shopify (SHOP)

Wood has been paring her holdings in Shopify (NYSE:SHOP) over the past year, but she still owns 4.4 million shares. She may find her holdings bumping competitively into Block as the two angle for elbow room. However, Shopify is enjoying smart gains in its own merchant growth efforts. 

The suite of tools it introduced last year to help merchants is seeing strong engagement. Gross merchandise value surged 30% after adjusting for the sale of Shopify’s logistics businesses. Additionally, it achieved operating margins of 13% and free cash flow (FCF) margin of 21%. FCF itself rose to rose to $446 million from $90 million last year. And, Shopify brought on several new big-name accounts including Nike (NYSE:NKE), Carrier (NASDAQ:CARR), and Dollar Shave Club.

Further, Shopify infused AI throughout its platform to enhance its functionality, usability and the overall experience. Even though it essentially focuses on one half of the vertical ecosystem between merchant and customer, Shopify is benefiting from the narrower focus. SHOP stock is up 81% over the past year and should see strong growth in the future.

Toast (TOST)

Toast (NYSE:TOST) is the smallest of the three digital financial service stocks with an $11 billion valuation. It’s also the one in which Wood owns the fewest shares, just 2.5 million. Yet, she’s been steadily buying the stock for the past three years, slowly building up her position.

TOST has a narrow focus, concentrating solely on the restaurant industry. It has a good base in which to work as well as offering sought-after tools. Because of the constraints the out-of-home food industry has operated under since the pandemic, the need for systems and technologies to improve tight margins are essential for today’s restaurants. Toast’s cloud-based products and services span the needs of the industry. Those include point-of-sale (POS) systems, digital ordering, delivery platforms, payments processing and financial solutions of capital and financing.

Toast services 106,000 locations that primarily interact with the fintech on a subscription basis. Annual recurring revenue grew 35% to $1.2 billion in 2023 as gross payment volume jumped 32% to $33.7 billion. While larger restaurant chains and moving into international markets could erode average revenue per user, they should still provide Toast with meaningful revenue growth over time. As the company moves towards profitability by mid-2025, expect TOST to bake in some large gains.

On the date of publication, Rich Duprey 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.