Crypto-Related Stocks: What’s been happening since the beginning of the year in the crypto space? The biggest news story of all is that bitcoin fell from its April 2021 heights of above the $62,000 mark to around $35,000 by early July. What’s propelling the bear market in BTC and other major alt-coins?
Multiple Factors Holding Down Cryptocurrency Prices
Several factors are obvious, including the flip-flopping of Tesla Motors on whether they intend to accept BTC as a form of payment, the Fed’s indication that it will likely start upping interest rates (which tends to be bad news for crypto holders and crypto prices in general), the apparent rebound of the economy in the wake of widespread COVID vaccination, the Chinese Communist Party’s stifling of both mining and usage of bitcoin, and more.
Are you among the cryptocurrency enthusiasts who like to play the entire market? If so, having a base interest in alt-coins is one of the smarter ways to diversity an entire portfolio consisting of stocks, cryptos, precious metals, and other assets, both tangible and intangible. One way to expose yourself to the potential growth of the alt-coin markets, if you don’t like the inherent volatility of individual coins, is to purchase stocks that are closely tied to the alternative currency niche.
A couple of characteristics of alt-coins that are of interest to all investors include the fact that institutional money has finally arrived, which is a significant sign of credibility and a solid signal that this new form of money is almost certainly going to exist for a very long time. Just a decade ago, nearly every institutional investor of note avoided all cryptos because they weren’t sure whether blockchain-based money was an idea that had staying power. Apparently, those worries are no longer a part of anyone’s thinking.
Companies To Watch in 2021
The biggest news story for many alt-coin enthusiasts this month is the fact that there are at least three stocks with close ties to the cryptocurrency market that have already done well in the past year and could continue performing throughout the post-COVID global economic recovery. Here’s a short summary of the three, with brief explanations about why each one could fit into a portfolio alongside leading cryptocurrencies like bitcoin, ethereum, and other niche leaders.
- CME Group Inc. (CME): As the largest single exchange for derivatives, it has launched a futures contract aimed primarily at well-heeled investors as well as institutions. The contracts are sized to be one-tenth of a bitcoin unit each. Clearly, the long-term success of the contract is directly tied to the fate of BTC, which makes this stock very much like a crypto.
- Nvidia Corporations (NVDA): The graphics-processor producer is closely connected to crypto mining because their products are at the very basis of the activity for millions of miners worldwide. Additionally, Nvidia has had a strong year and is considering getting back into the mining niche during 2021.
- PayPal Holdings (PYPL): PayPal is what some call an “early adopter” of crypto technology. Anyone with an account on the payment processor’s site can use their crypto assets to make purchases at any store that accepts PayPal, which is a very large number of retailers all over the world. PayPal also allows account holders to sell, hold, and purchase cryptocurrencies right on its platform
Adding To the Selections
It’s important to remember that the three stocks listed above serve only as a starting point for crypto enthusiasts. There are dozens of other securities, both large and small, that offer a way to create a list of holdings that tend to rise and fall with the overall performance of the alt-coin market.