If you don’t have a few extra million lying around to invest in bitcoin, read on to learn about some of the best blockchain stocks, which are less expensive investment options but still provides exposure to a technology predicted to to make a big revolution in the coming decades.
As the world of cryptocurrencies continues its rollercoaster ride, prudent investors may want to concentrate on some of the best blockchain stocks.
The thriving world of digital finance can be entered more predictably and smoothly with the help of traditional finance. It is a sensible plan to research high potential blockchain stocks by utilising this technology's powerful capabilities rather than riding the erratic wave of the cryptocurrency market.
Since many of these businesses are not pure plays, there is a backup plan in the form of an established core business. Today, many publicly traded organizations are incorporating blockchain into their business processes and offering clients blockchain-centric services.
How to trade and invest in Blockchain Stocks and ETFs
- Research your blockchain stocks – from established public companies have dabbled in blockchain businesses while smaller, to smaller, more focused firms that have put blockchain at the core of their operations, there are multiple options available;
- Define your strategy – trading lets you speculate on the price movement; dealing lets you take direct ownership of the shares of stocks or funds;
- Take your position – create an account with us to start trading and investing in blockchain stocks, ETFs and thematic portfolios focused on blockchain.
For more info about how to trade and invest in blockchain stocks, including some of the best blockchain stocks and ETFs for 2024 read our guide below.
What is Blockchain?
Blockchain is a shared and immutable ledger that records transactions and tracks digital and non-digital assets using a computer network. An asset could be tangible (a car, house, cash, land, etc.) or intangibles (intellectual property patents, copyrights, and branding). A blockchain network allows anyone to track and trade virtually any asset, which reduces the risk of losing track of funds, and cuts costs.
At the core of the blockchain are the information blocks, which are basically a string of information. Every data block is kept in a time-stamped open ledger that all participants can access. This makes blockchain technology particularly useful in industries such as banking, where security is important.
What are Blockchain Shares?
Blockchain stocks are a more traditional, conservative way to tap into the rapidly growing blockchain technology, without betting it all on cryptos. Blockchain technology may prove to be a critical tool for conducting transactions and securely exchanging information, according to some of the biggest corporations in the world. And by trading or purchasing the stocks of those businesses, investors can expose themselves to a cutting-edge segment of the technological industry without really purchasing bitcoin, altcoins or NFTs.
Large, established public companies have dabbled in blockchain businesses while smaller, more focused firms have put blockchain and crypto at the core of their operations. In either case, there has yet to be a killer app that has made the case for blockchain as a core part of the future of business and technology.
It’s important to note that not all blockchain stocks are cryptocurrency stocks. Though some stocks in the blockchain space are companies that run crypto exchanges or even mine Bitcoin, others are large financial institutions or established technology firms that are developing blockchain products.
Best Blockchain Shares in February 2024
Whether you’re eyeing blockchain stocks with explosive upside or scouting for the best blockchain stocks to buy and trade, the market is ripe with options extending far beyond mere crypto trading.
A list of the top-performing stocks won’t indicate which will do well in the future, but many top stocks deliver solid returns year after year. Nvidia and AMD have boomed in 2023 driven by the Artificial Intelligence megatrend, while Amazon for instance, seem to have delivered attractive gains for what seems like forever, so following the best stocks may give you a clue as to which contenders can perform well in the years to come.
Here is a list of the top blockchain stocks for 2024 that you should consider if you want exposure to this exciting technology in your investment portfolio.
RIOT Blockchain (RIOT)
Riot Blockchain (NASDAQ: RIOT) is the company to watch for investors looking for an investment in the Bitcoin mining industry.
With a healthy balance sheet, a sizable cash reserve of $390 million, and no long-term debt on its books as of the first quarter, Riot is well-positioned for aggressive long-term expansion. It is important to highlight its appeal as a cheap Bitcoin miner, and an impending sustained BTC surge or decline may boost the company's share price or drag them down.
Riot announced a capacity of 10.5EH/s in the first quarter, a startling 144% year-over-year increase, indicating a rise in mining capacity. The company mined an amazing 676 BTC in May 2023, up significantly from the 466 in the same month last year and the 639 in April. A substantial net profit of $16.5 million was generated by the sale of 600 BTC at an average net price of $27,568.
Block (NYSE: SQ), formerly known as Square, has emerged as a major player in the financial industry. The technology behemoth has been making headlines by fusing tools and services to build whole ecosystems like Square and the Cash App.
The company underwent a name change in 2021, but it also signalled a strategic shift towards blockchain technology solutions and cemented its place as a major participant in this emerging market. The business is clearly committed to integrating blockchain technology. Block had invested $133 million in Bitcoin by the end of 2022, demonstrating his faith in the blockchain industry.
Block had a 18% increase in BTC revenue in the first quarter of 2023 compared to the prior quarter. A substantial $2.16 billion worth of Bitcoin was sold to clients in total, a 25% increase over the same quarter last year. As a result, the fintech giant successfully adopts the blockchain revolution and is not forecasted to slow down anytime soon.
MicroStrategy Incorporated (MSTR)
MicroStrategy is essentially a proxy for direct BTC investment without a spot Bitcoin exchange-traded fund (ETF) in the United States. It mirrored Bitcoin’s 90% YTD gains, maintaining a strong positive correlation with the top cryptocurrency. It holds 140,000 BTC worth $4.26 billion, the most by a publicly traded company as a part of its treasury strategy.
MSTR investors typically get their buying or selling cues from the same catalysts that drive Bitcoin market trends. As a result, the stock has mirrored the BTC price uptrend so far in 2023, led by rush-to-safety trades amid the U.S. banking crisis and anticipation that the Federal Reserve would stop hiking rates.
MicroStrategy is essentially an enterprise software solution company and generates its revenue from software licensing and subscription services. Although its core business is unhealthy and could sell its Bitcoin holdings to boost its balance sheet reserves, the company said it would not alter its BTC buying strategy under financial stress. Instead, it employs strategies like share dilutions and debt offerings to raise capital to buy BTC.
Other top blockchain stocks
This is the largest manufacturer of graphics processing units (GPUs), which are one of the most important hardware components for cryptocurrency mining. Plain and simple, the blockchain wouldn’t work without these GPU cards. Although sales of Nvidia's crypto-targeted CMP chips have cooled off as cryptocurrency prices have declined, sales are expected to rebound if the crypto market recovers. And, even if it doesn't, the rest of Nvidia's business is an absolute powerhouse market leader.
Honeywell International Inc. (HON)
Honeywell International Inc. operates in four segments which cover the productivity, building technologies, materials, and aerospace markets. Honeywell also became one of the first companies in the world in 2019 to bring the reliability of blockchain technologies to the aerospace segment, as it used the secure ledger platform to introduce an online marketplace which significantly reduced transaction times in a highly sensitive market that needed secure part authentication.
Coinbase is the largest cryptocurrency exchange in the world, offering more than 100 cryptocurrencies. There are approximately 73 million users verified in over 100 countries and more than $1 billion of cryptocurrency trading volume through the company's platform.
Marathon Digital Holdings, Inc. (MARA)
Marathon Digital Holdings emerged in the market in the aftermath of the boom in cryptocurrencies and it is also a publicly-traded company. MARA runs cryptocurrency mining facilities capable of consuming megawatts of electrical power and it reported $38 million in revenue during the first half of this year.
VMware, Inc. (VMW)
VMware offers its enterprise customers the VMware Blockchain platform which is primarily focused on providing the companies with a secure platform for their daily transactions and other record-keeping needs.
IBM Blockchain, on the blockchain side, has already offered transformative solutions to clients like Kroger, True Tickets, and others. If blockchain-based solutions gain more popularity, the company could see significant growth.
HIVE Blockchain Technologies (HIVE)
HIVE Blockchain works to build a bridge between the blockchain space and traditional capital markets. HIVE Blockchain is also involved in mining cryptocurrencies such as Ethereum and Bitcoin, using 100% green energy.
Argo Blockchain plc (ARBKF)
Argo Blockchain is a United Kingdom-based cryptocurrency mining company. Argo is a mining-as-a-software (MaaS) service provider that makes it easy for clients to mine Bitcoin Gold, Ethereum, and other alternative coins (altcoins) through the cloud.
CME Group (CME)
This is the largest options and futures exchange. It offers futures on Bitcoin and Ethereum. It also is the only exchange that creates a market for cryptocurrency futures contracts, although rival exchange CBOE is planning to reenter the space in the future.
Mastercard announced a partnership with R3 blockchain technology company to develop a cross-border payment system. This could give the company a significant competitive advantage by eliminating major barriers to international money transfers.
DocuSign is the market leader in eSignature technology. They have used blockchain technology since 2015 to allow customers to record their agreements using the Ethereum blockchain.
Amazon Managed Blockchain is a feature of the AWS (Amazon Web Services) platform that allows customers to manage and create their own blockchain networks. Amazon has the potential to incorporate blockchain technology in its huge e-commerce business.
PayPal Holdings Inc. (PYPL)
Digital payments specialist PayPal is fully embracing cryptocurrency and blockchain technology. Not only can users buy and sell crypto in their PayPal accounts, but PayPal is also reportedly exploring the launch of its own stablecoin that would be backed by the U.S. dollar.
Advanced Micro Devices Inc. (AMD)
Semiconductor company Advanced Micro Devices is developing a central processing unit and graphics processing unit technology aimed at making blockchain transactions faster and more secure. The company is also working on developing blockchain compute solutions with a wide variety of use cases.
How to find blockchain stocks
The stocks mentioned above represent just a small piece of the universe of companies trying to use blockchain technology. If you’re considering investing in blockchain stocks, you can dig deeper in a couple of ways.
Stock indices ETFs ThematiX There are a couple of stock indices that are curated to provide a sampling of the economy around blockchain. The Nasdaq Blockchain Economy Index is one example. Looking at the companies listed there, and digging into their businesses, can help turn up blockchain stocks that might appeal to you. Exchange-traded funds allow you to buy a selection of stocks or other investments directly from a public exchange. This can be helpful if you want exposure to several companies without having to assemble an investment portfolio yourself. ThematiX blends the world’s top trending stories & topics of interest into stock portfolios designed to make trading exciting, and personal. Our blockchain ThematiX includes the most relevant companies supporting this movement, including tech giants IBM, Amazon, and Nvidia.
What are Blockchain stock funds (ETFs)
An ETF (Exchange-Traded Fund) is an investment product that is based upon an underlying asset. A blockchain ETF owns stocks in companies that have business operations in blockchain technology or profit from it in some way. Most investors are still precautious when investing in blockchain shares, especially due to the blockchain association with cryptocurrencies and their highly volatile values.
Bear in mind that blockchain technology is different from cryptocurrency, and a blockchain ETF is different from a cryptocurrency ETF, including the first Bitcoin ETF launched in 2021. For instance, blockchain ETFs invest only in stocks of regulated public companies. Many of these are popular blue-chip tech companies with no direct cryptocurrency involvement.
ETFs can also be traded on the regular stock exchanges, just like any other stock or commodity. The stock prices of these companies are affected not only by blockchain technology but also by hype and other factors related to blockchain.
Best Blockchain ETFs for 2024
Blockchain ETFs are one of the ways to get exposure to cryptocurrency and blockchain technology without investing in cryptocurrencies. These funds track stocks of companies that invest in blockchain technology and are also available in the traditional markets.
The blockchain ETF marketplace is still a niche area, and only a handful of funds are focused on the blockchain space. Remember that there is no public company that is only focusing on blockchain, and most of these ETFs have stocks that overlap with other funds. We’ll mention some of the most popular blockchain ETFs to illustrate what kind of assets these funds can hold.
GlobalX Blockchain ETF
If you’re eyeing the blockchain sphere, the Global X Blockchain ETF (NASDAQ:BKCH) offers a smooth ride in this roller-coaster of industry. The GlobalX Blockchain (BKCH) was created in mid-2021. It allows investors to have exposure to a whole range of blockchain stocks through one investment.
GlobalX Blockchain ETF charges an expense rate (an annual investment fee) of 0.50%. This is reasonable for a targeted fund. It can invest in 25 companies, including Riot Blockchain stock, Coinbase and Hive Blockchain stock, and others that aren’t listed on U.S stock exchanges. This ETF is a good option if you believe in blockchain technology's long-term potential but don’t want to try and pick winners.
Bitwise Crypto Industry Innovators ETF (BITQ)
BITQ is a passively managed fund that tracks the Bitwise Crypto Innovators 30 Index's performance which contains 30 stocks from companies that are heavily involved in crypto markets and blockchain technology, such as mining equipment suppliers, financial services companies, and crypto mining outfits. A company must have at least 75% of its revenues in crypto, or 75% of its net assets in Bitcoin or other crypto assets to be included in the Index. The index accounts for 85% of BITQ holdings. The remaining 15% includes large-cap stocks that are tangentially engaged in crypto or have at least $100M in Bitcoin, Ethereum, or another crypto asset. BITQ's top holdings include Silvergate Capital, MicroStrategy, and Coinbase.
Invesco Elwood Global blockchain UCITS ETF
Invesco Elwood Global blockchain UCITS ETF seeks to capitalize on the upside growth potential for companies using blockchain technology. These potentials are often hidden in companies that most investors would not notice. The ETF tracks the performance of the Elwood Blockchain Global Equity Index (BLOCK). It was created by an investment firm that specializes in providing institutional investors exposure to digital assets.
Amplify Transformational Data Sharing ETF (BLOK)
BLOK was launched in January 2018, and it was the first exchange-traded fund to invest in blockchain technology. BLOK is actively managed, and it aims to invest only in shares of companies using or developing blockchain technology. This blockchain ETF targets crypto exchanges and companies involved in mining as well as developers of new blockchain apps. Some of the top holdings of the fund include Nvidia, Cooinbase, and Silvergate Capital.
How to Invest in Blockchain Shares and Funds
Blockchain technology is not limited to cryptocurrencies, and it has many other applications, such as international payments, decentralized finance, auditing, and regulatory compliance. Here are some of the most popular ways to invest in blockchain shares and blockchain ETFs.
Please note that some of the blockchain shares and funds are high-risk investments and may not suit every investor.
Buy and Hold
The most common strategy for investors is the buy-and-hold strategy, which implies that the Blockchain shares, and ETFs are held for longer periods. Those who apply this strategy believe that the long-term gains from investing will outweigh the volatility of the asset.
The buy-and-hold strategy is simple. Simply pick a stock, ETF, or mutual fund and buy it. Then, hold it for many years. You could also keep it for many decades. Investors rely on fundamental analysis when choosing their assets for the buy-and-hold strategy. Ideally, you would look for blockchain stocks that are low in price relative to the company's fundamental value. This strategy is regarded as passive investing, and it is particularly useful for markets in which the “time in the market” is more important than “timing the market”.
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Trading through CFDs
Trading blockchain stocks CFDs (contracts for difference) allows investors to gain exposure to price movements without owning the underlying assets. CFDs can be described as contracts between two parties (i.e., the provider and you). They require the provider to pay the difference in exit and entry prices. Because its price is determined from the price of an underlying asset, it is considered a financial derivative instrument. CFDs have made trading accessible to all investors, due to the low entry cost and straightforward mechanism.
With CAPEX you can trade CFDs on +20 top cryptocurrency with zero commission and tight spread, as well as +2.000 international stocks, commodities, funds, and currency pairs within a single Trading Account.
Blockchain Future ThematiX
Blockchain Future ThematiX is a blended fund that includes top chip stocks. These blended funds allow investors to diversify among the most popular investment styles within a single portfolio. Blend funds also allow investors to take advantage of both the capital gains potential and the stability and dividend income of the value segments.
Blend funds were created to give investors the benefits of both value and growth investing. Value stocks seek to make a profit from investments that are undervalued based on their fundamental characteristics. Growth stocks seek to make a profit from companies that have substantial capital growth potential in terms of earnings or capital gains. Blend funds combine both types in one portfolio.
Blend funds can be managed using a variety of strategies, so investors should make sure they are clear about their allocation. Blend funds can be used to cover a wide range of investment options.
With CAPEX, you can trade the Blockchain Future ThematiX, which consists of 55% AMZN, 21% NVIDIA, 11% MasterCard, 4% IBM. 4% Square, 3% CME, 2% DocuSign Inc.
Blockchain technology is a promising area of innovation that can be applied to many sectors. Investors around the globe are intrigued by its potential after witnessing its tremendous growth over the last decade. Of course, the rise of cryptocurrencies such as Bitcoin and Ethereum has fueled the interest in the technology behind the blockchain.
Anyone looking to invest in blockchain technology should research cryptocurrencies and other blockchain and crypto-related companies. However, investing in a Blockchain ETF can be a worth checking strategy since it is giving larger diversification than investing individually in blockchain-related businesses, as they cover a wider range of companies.
Before you invest in blockchain stocks and blockchain ETFs, you should consider using the educational resources we offer like CAPEX Academy or a demo trading account. CAPEX Academy has lots of free cryptocurrency and blockchain courses for you to choose from, and they all tackle a different financial concept or process – like the basics of analyses – to help you to become a better trader or make more-informed investment decisions.
Our demo account is a suitable place for you to get an intimate understanding of how trading and investing work – as well as what it’s like to trade with leverage – before risking real capital. For this reason, a demo account with us is a great tool for investors who are looking to make a transition to leveraged securities.