Digital currencies have emerged as a popular investment choice, experiencing wider acceptance. While markets for virtual assets like Bitcoin (BTC -2.44%) were relatively unknown back in 2012, they’ve since evolved into a substantial industry.
Image source: The Motley Fool.
The cryptocurrency sphere reached a market capitalization high of $3 trillion in the autumn of 2021. This sudden value explosion quickly generated substantial wealth for those who got in on the ground floor. After that peak, the crypto market experienced fluctuations before surpassing the $3 trillion threshold again in autumn of 2024.
The big question on many minds is: which cryptocurrency will be the next Bitcoin or Ethereum (CRYPTO:ETH)? Considering the thousands of cryptocurrencies currently available, investing in companies that connect the digital blockchain domain and everyday life could be even more profitable. Numerous inventive companies and investment instruments are endeavoring to unite these two realms.
Are they a good investment?
Digital currency companies hold major potential
The underlying concept of blockchain technology – a digital record that automatically monitors transactions between parties and validates cryptocurrency ownership – aimed to create an efficient and secure, borderless electronic cash system functioning on a peer-to-peer level.
Investors can choose to purchase cryptocurrencies directly, perhaps investing smaller amounts in several different coins. Another avenue is investing in larger, more established companies poised to gain from the expanding popularity of blockchain and crypto. The revenue generated by crypto service providers from blockchain technology has witnessed significant growth over time.
Companies implementing blockchain, particularly within the financial sector, may achieve a distinct competitive edge over traditional competitors in payment processing. Brokers offering digital assets might attract a larger customer base compared to exchanges focused on conventional assets such as stocks and bonds.
You can even invest in exchange-traded funds (ETFs) that track the real-time price of Bitcoin. In January 2024, regulators gave the green light to eleven such funds, with prominent examples being the iShares Bitcoin Trust (IBIT -1.12%) and the Fidelity Wise Origin Bitcoin Trust (FBTC -1.11%). These ETFs make Bitcoin easily accessible to a wider spectrum of investors.
However, this sector is known for its volatile nature. The $3 trillion high plunged to below $1 trillion in June 2022 as rising inflation encouraged investors to move away from higher-risk investments. The economic slump also occurred alongside a downward trend in the cyclical cryptocurrency market, often referred to as a “crypto winter.”
This wasn’t the first major crash in the crypto market, and it likely won’t be the last. All investments involve risk, and you should only invest funds you don’t need access to in the short term. This advice is especially crucial in the highly unpredictable crypto market.
Bearing that in mind, here are some notable crypto and crypto-related stocks to consider.
A blockchain platform designed to enhance global functionality and redistribute power fairly.
Coinbase
1. Coinbase Global
Coinbase Global (COIN -14.9%), a leading cryptocurrency exchange platform, held its initial public offering (IPO) in April 2021. It provides a user-friendly platform for purchasing prominent cryptocurrencies like Bitcoin, Ethereum, and Cardano (ADA -3.8%), and facilitates trading in approximately 250 cryptocurrencies, including various altcoins.
Coinbase’s achievements are closely tied to the rise in cryptocurrency prices, which has in turn attracted millions of new users. The platform earns a small transaction fee on each buy or sell order. However, the company has aspirations beyond just trading, sponsoring a debit card that enables users to spend from their digital wallet balance and introducing a cloud-based platform for businesses involved in using and storing digital currencies.
Coinbase’s innovative approach includes two key features. Firstly, it extends asset loans – once limited to wealthy investors – to a wider audience. Users can leverage their Bitcoin or other crypto holdings as collateral to secure low-interest loans, providing a means to manage expenses without selling their crypto assets, allowing their investment to potentially continue growing.
Secondly, the increasing adoption of Coinbase’s blockchain analytics tools by governments and financial institutions is noteworthy. As blockchains generally operate using public ledgers, Coinbase can analyze and monitor data for illegal transactions and problematic wallet addresses.
For example, if hackers were to infiltrate a computer system and demand Bitcoin as ransom to unlock it, Coinbase could correlate the hacker’s wallet address with the vast know-your-customer (KYC) information it holds. This would enable law enforcement to track the flow of funds and potentially apprehend the cybercriminals, thus enhancing confidence in the crypto space.
Overall, investing in Coinbase represents a general bet on the overall cryptocurrency market. If crypto trading and ownership continue to gain popularity, Coinbase and its shareholders stand to benefit from this upward trend.
[Cryptocurrency] represents a fresh asset class; akin to real estate, there’s a fixed amount available. Its finite nature leads to pricing that reflects how much people value and desire it.
David Gardner, co-founder, The Motley Fool.
Block and PayPal
2. Block and PayPal Holdings
Every digital payment system revolves around the elimination of central intermediaries – which translates to reduced costs for businesses and consumers. As such, Block (NYSE: XYZ) (formerly Square) and PayPal (PYPL -2.11%) recognized the potential of enabling users to purchase and hold cryptocurrencies within a digital wallet.
Block’s Cash App, a user-focused app, incorporated Bitcoin trading in late 2017. Bitcoin is a substantial revenue generator for Block during crypto upswings, even if the trading feature doesn’t significantly impact the company’s final profit. In 2024, Block achieved $2.4 billion in quarterly Bitcoin revenue, with a gross profit of $64 million per reporting period.
Furthermore, the company promotes Bitcoin usage among its business users through the Block ecosystem, and it may evolve into a key platform for crypto transactions between businesses and customers. This is particularly promising for revolutionizing traditional international transactions, where banks often apply high exchange fees. In April 2022, Cash App added Bitcoin Lightning Network support, facilitating faster and more cost-effective Bitcoin transfers. CEO Jack Dorsey highlighted that the feature would “improve Bitcoin’s usability towards an open global financial network.”
PayPal’s Venmo digital wallet and peer-to-peer payment application launched crypto trading in early 2021, offering a similar set of simple banking features and mass-market crypto trading tools. Venmo initially supported trading of Bitcoin, Bitcoin Cash (BCH -3.23%), Ethereum, and Litecoin (LTC -2.61%). More cryptocurrencies may be added in the future, including the Paypal USD (PYUSD 0.01%) stablecoin introduced in 2023.
With the most users of any peer-to-peer money transfer app, Venmo is positioned to potentially become a prominent cryptocurrency platform. It provides a reliable entry point for investors interested in purchasing major cryptocurrencies and using them for altcoin purchases or accessing decentralized finance (DeFi) applications.
Canaan and Hut 8
3. Canaan and Hut 8 Mining
Bitcoin mining has undergone significant changes in recent years. Companies like Canaan (CAN -6.49%) now design specialized, high-powered application-specific integrated circuit (ASIC) machines for the sole purpose of determining the correct hashes for proof-of-work cryptocurrencies. Canaan’s cutting-edge Avalon ASICs are capable of making tens of trillions of guesses every second to validate blocks on the Bitcoin network – millions of times faster than the latest graphics processing units (GPUs) from AMD (AMD -1.38%) and Nvidia (NVDA -1.07%). Their affordability and relatively low energy consumption have led to rising sales, resulting in enhanced profits for miners.
Hut 8 Mining is also a very popular Bitcoin mining stock. It offers investors direct exposure to the price of Bitcoin. Investors in Hut 8 gain direct exposure to the potential upside of the crypto market without holding the coins themselves, simplifying the investment process.
Investors can rest assured that environmental concerns about mining practices will not hinder Hut 8, as they rely on renewable energy and can supply electricity back to local utilities as needed.
Nvidia and AMD
4. Strategy
Formerly known as Microstrategy, the company now rebranded as Strategy (MSTR -4.47%), with a dedicated focus on cryptocurrency operations, is a poorly-kept secret on Wall Street.
The company initiated the conversion of its cash reserves into Bitcoin in summer 2020, and its enterprise software operations started to seem less relevant.
As of February 2025, the company held 478,740 Bitcoins on its balance sheet, valued at $46.6 billion at the then-current spot price. Strategy intends to continue purchasing Bitcoin, planning to raise $21 billion through loans and another $21 billion via stock sales to facilitate further crypto acquisitions from 2024 to 2027.
This is an ambitious strategy that could yield massive returns if Bitcoin’s value continues its long-term rise. However, it is also a risky one, exposing investors to potential losses if the Bitcoin narrative takes an unexpected turn.
Strategy is best approached as a small, speculative investment – significant enough to potentially make a difference, but small enough to avoid sleepless nights in the event of a total loss. It constitutes an all-or-nothing approach to Bitcoin’s intrinsic value, reinforced by conventional business practices like loans and strategic stock offerings.
Robinhood
5. Robinhood Markets
Robinhood Markets (HOOD 0.31%) is a widely-used discount brokerage app that allows users to trade stocks, options, precious metals, and increasingly, cryptocurrencies. The platform permits investors to buy and sell over a dozen cryptocurrencies, including Bitcoin, Ethereum, and Dogecoin (CRYPTO:DOGE), without commission fees, 24 hours a day, 7 days a week. The company already manages billions of dollars in crypto assets, with crypto trading revenue now accounting for a sizable portion of its overall income.
Robinhood can enhance its competitive edge by merging its commission-free trading structure with an expanding array of cryptocurrencies on its platform, gaining an advantage over both traditional and decentralized exchanges. Furthermore, Robinhood could offer crypto analytics services similar to those provided by Coinbase to promote trust in the crypto sector and bolster its overall acceptance.
Bitcoin Cash, designed to function as the digital equivalent of cash, shares a similar structure with Bitcoin but with some modifications.
CME Group
6. CME Group
CME Group (CME 1.19%) manages the world’s leading financial derivatives exchange, facilitating investors to trade futures (contracts to buy or sell an asset at a specified price in the future) and options (contracts offering the right, but not the obligation, to buy or sell an asset at a pre-determined price at a future date). The CME Group exchange trades a diverse range of assets, including agricultural and mining products, energy resources, stocks, and currencies. It’s this latter category that positions CME Group as a crypto stock.
CME introduced the first market for Bitcoin futures in late 2017, followed by a market for Bitcoin futures options in early 2020. By March 2022, Ether futures (related to the Ethereum cryptocurrency) became available on the exchange. Micro futures, based on smaller increments of these underlying cryptocurrencies, have also been introduced for both Ether and Bitcoin this year.
By establishing a comprehensive exchange for derivatives of leading cryptocurrencies, CME has lent increased legitimacy to Bitcoin and Ethereum, while giving digital currency holders (including individuals and an increasing number of businesses accepting crypto payments) a tool to mitigate risk associated with cryptocurrency price fluctuations. Cryptocurrency derivatives constitute a small portion of CME Group’s overall business currently, however, expansion into more crypto asset exchanges remains a possibility – and a likely future development.
Related crypto topics
Crypto’s mainstream adoption
The beauty of crypto stocks
One of the most appealing characteristics of cryptocurrency stocks is that they generally aren’t solely reliant on the crypto industry, offering investors the benefit of significant diversification. Cryptocurrencies are prone to volatility and can induce substantial swings in the revenue and earnings of companies with crypto market exposure.
The crypto market is increasingly being embraced by the mainstream. For instance, in August 2021, United Wholesale Mortgage (UWMC 4.83%), a leading mortgage lender in the U.S., revealed that it would accept Bitcoin for mortgage payments from its customers. Anticipate continued positive movement in crypto stocks as more companies engage with the blockchain revolution.
Keep an eye on the evolving regulatory environment as the crypto market adapts to changes in the global economy. The stocks mentioned are intelligent investments in digital currencies, offering diversification outside the crypto sector. For many investors, these holdings are more sensible investments, compared to purchasing the cryptocurrencies themselves, at least until global regulators and governments formalize their long-term approaches to digital assets.