News

1 Cryptocurrency Stocks Rise 30% in 2024 and Could Keep Going Higher

Published

9 months ago

13 May, 2024

1 Cryptocurrency Stocks Rise 30% in 2024 and Could Keep Going Higher

I’ve been very critical of Robinhood Markets (NASDAQ:HOOD) over the last two years, which wasn’t necessarily controversial given that its stock has suffered a peak-to-trough drop of 91% from its all-time high. The online brokerage platform was constantly losing active users and, as a result, its transaction revenues seemed to be in perpetual decline.

However, Robinhood’s fortunes have changed in 2024. A rising stock market has brought users back into the fold and they are actively trading, which is driving up the company’s revenue.

The fastest-growing part of Robinhood’s business right now, however, is the cryptocurrency segment, where revenue more than tripled year-over-year during the latest first quarter of 2024 (ended March 31). Robinhood stock is up 30% so far in 2024, but here’s why it could be set to rise.

Robinhood’s most important metric increased

Robinhood’s monthly active users (MAU) peaked at 21.3 million during the second quarter of 2021. They have declined in nearly every quarter since then, bottoming out at 10.3 million near the end of 2023. It was the main reason why I was bearish on the company’s prospects. Simply put, generating sustainable revenue growth will be extremely difficult if the number of users to be monetized continues to shrink.

However, Robinhood’s MAU has increased from that low point and the metric currently stands at 13.7 million. At the end of the first quarter, the company also had a record 23.9 million total funded customer accounts, and the value of assets held within them increased 65% year over year to $130 billion.

The latter figure was helped by the rise in shares and cryptocurrency prices. The major US stock market indexes have reached record highs in 2024, as have the major cryptocurrencies Bitcoin.

Robinhood customers also deposited $11.2 billion in new funds during the quarter. The platform earns commissions through a practice called payment for order flow, which involves forwarding customer orders to third parties market creators for fulfillment. Submitting a $10,000 stock or cryptocurrency order earns Robinhood a higher commission than a $5,000 order, so its assets in custody are a very important indicator of its earning potential.

Robinhood’s revenue soared during the first quarter

Robinhood generated record revenue of $618 million during the first quarter, 40% more than the same period a year earlier. But the real story is beneath the surface of the headline number.

Transaction revenue increased 59% to $329 million, which is important because it is earned through the company’s brokerage operations. There was a positive contribution from all asset classes (stocks, options and cryptocurrencies), but cryptocurrencies had the best performance, with revenues increasing by 232%:

The story continues

A slide showing Robinhood's quarterly trading revenue breakdown, with growth rates.

Image source: Robinhood Markets.

This was a positive change from 2023, when Robinhood’s total revenue was mostly driven higher by interest income. The company has $4.7 billion in cash and cash equivalents on its balance sheet, as well as holding $4.5 billion on behalf of clients, so the rapid rise in interest rates over the past two years has increased the amount it was earning storing that money in banks.

Robinhood also earns interest on its credit card and margin lending businesses. Overall, the company generated $254 million in total interest revenue during the first quarter, up 22% year-over-year. This number could shrink over the next year if the US Federal Reserve cuts interest rates as expected, which makes Robinhood’s trading revenue recovery even more important.

Finally, Robinhood continues to build on its earnings progress. The company’s operating costs fell 52% during the first quarter, and because revenue grew so quickly, that led to $157 million in GAAP (generally accepted accounting principles) net income—a huge change from the net loss up $511 million from the same period a year ago.

Much of the decline in operating costs is attributable to the cancellation of Robinhood’s founders’ reward, which granted stock to the company’s founding team. This led to a $536 million reduction in stock compensation expense during the first quarter.

Why Robinhood stock could go up from here

To Robinhood’s credit, it was not deterred by the collapse in its stock price after 2021. The company has continued to innovate and expand its product portfolio, and those initiatives are starting to pay off.

For example, it introduced a pension offering in January 2023 and already has more than 650,000 customers on board. During the first quarter, Robinhood’s assets under custody for its retirement segment topped $4 billion, a 14-fold increase from its launch a year earlier. Many of Robinhood’s customers are young, novice investors, so it could generate a powerful long-term revenue stream if it can convince them to stick around for their decade-long journey to retirement.

Robinhood is currently valued at nearly $15 billion. Based on trailing 12-month revenues of $2 billion, its shares trade at a price-to-sales (P/S) ratio of around 7.6. This is substantially lower than its peak, set in 2021, because the company’s revenues have grown along with the decline in the share price:

PS HOOD ratio graph

I previously argued that Robinhood’s shrinking user base and stagnant revenue warranted a low P/S ratio. However, now that profits have returned to growth – driven by a significant acceleration in transaction revenues – it makes sense for the stock’s P/S ratio to rise.

Therefore, there may be additional benefits for Robinhood investors.

Should You Invest $1,000 in Robinhood Markets Right Now?

Before you buy stocks in Robinhood Markets, consider this:

The analyst team at Motley Fool Stock Advisor has just identified what they believe is the 10 best stocks for investors to buy now… and Robinhood Markets wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia you created this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you would have $550,688!*

Stock Advisor provides investors with an easy-to-follow, successful model that includes guidance on building a portfolio, regular updates from analysts, and two new stock picks every month. The stock advisory service has more than quadrupled the return of the S&P 500 Index since 2002*.

See the 10 titles »

*Equity advisor will return starting May 6, 2024

Antonio Di Pizio has no position in any of the securities mentioned. The Motley Fool has positions and recommends Bitcoin. The Motley Fool has a disclosure policy.

1 Cryptocurrency Stocks Rise 30% in 2024 and Could Keep Going Higher was originally published by The Motley Fool

Source

Up Next

Tokyo-listed Metaplanet outlines Bitcoin plan amid growing economic pressure in Japan

Don't Miss

Here’s how tokenization revolutionizes the real estate sector

FinCrypt Staff

We are the editorial team of FinCrypt, where seriousness meets clarity in cryptocurrency analysis. With a robust team of finance and blockchain technology experts, we are dedicated to meticulously exploring complex crypto markets with detailed assessments and an unbiased approach. Our mission is to democratize access to knowledge of emerging financial technologies, ensuring they are understandable and accessible to all. In every article on FinCrypt, we strive to provide content that not only educates, but also empowers our readers, facilitating their integration into the financial digital age.

Click to comment

News

Block Investors Need More to Assess Crypto Unit’s Earnings Potential, Analysts Say — TradingView News

Published

7 months ago

11 July, 2024

FinCrypt Staff

DeFi Lending Protocol Nexo Allocates $12 Million for Ecosystem Incentives — TradingView News

Block, a payments technology company led by Jack Dorsey square could become a formidable player in the cryptocurrency mining industry, but Wall Street will need details on profit margins to gauge the positive impact of the business on earnings, analysts said.

Block signed its first large-scale cryptocurrency mining hardware pact on Wednesday, agreeing to supply its chips to bitcoin miner Core Scientific CORZbut no financial details were disclosed.

JP Morgan estimates the deal could net Block between $225 million and $300 million, but said more information will be needed to assess the hardware business’s long-term earnings potential.

“We still have a lot to learn in terms of the margins of this business, so we are hesitant to underwrite this transaction until we know more about the cadence and economics,” J.P. Morgan said.

The deal marks a major step for the payments company, which started out as “Square” in 2009 before rebranding in 2021 in a nod to its focus on crypto and blockchain technologies.

Dorsey, who co-founded and ran Twitter (now known as “X”), has long been bullish on Bitcoin. Block began investing 10% of its monthly gross profit from Bitcoin products into Bitcoin in April.

In the first quarter, nearly 9% of the company’s cash, cash equivalents, and marketable securities consisted of bitcoin.

“This development (the deal with Core Scientific) is further evidence of Block’s role as an emerging leader in the crypto hardware ecosystem,” Macquarie analysts Paul Golding and Emma Liang wrote in a note.

Analysts say similar deals to follow could further validate Block’s reputation in the industry.

But J.P. Morgan said the stock’s performance will be determined by Block’s other segments, such as Square and Cash App.

Block shares have lost nearly 17% this year.

Source

News

This Thursday’s US Consumer Price Index could be a game-changer for cryptocurrencies!

Published

7 months ago

11 July, 2024

FinCrypt Staff

This Thursday's US Consumer Price Index could be a game-changer for cryptocurrencies!

3:30 PM ▪ 4 minute read ▪ by Luc Jose A.

This Thursday, attention will be focused on the United States with the anticipated release of the Consumer Price Index (CPI). This economic indicator could trigger significant movements in the markets, especially for the U.S. dollar and cryptocurrencies. While investors remain vigilant, speculation is rife about the potential impact of these key figures.

The Consumer Price Index: The Cornerstone of the American Economy

The Consumer Price Index (CPI) is a key measure of inflation which reflects changes in the price of goods and services purchased by American households. This index is calculated monthly by the Bureau of Labor Statistics (BLS) and serves as a barometer for the cost of living. The consumer price index covers a wide range of products, including food, clothing, housing, health care, and entertainment. Economists and policy makers closely monitor this data to anticipate economic trends and adjust monetary policies accordingly.

The June CPI data is due to be released this Thursday at 2:30 p.m., and is highly anticipated by investors. The current consensus is for headline annual inflation to decline to 3.1%, from 3.3% the previous month, while core inflation is expected to remain stable at 3.4%.

THE BIGGEST EVENT THIS WEEK 🚨

The U.S. Consumer Price Index is expected to
PUBLICATION TODAY AT 8:30 AM ET.

EXPECTATIONS ARE 3.1% WHILE
LAST MONTH THE CONSUMER PRICE INDEX (CPI) WAS 3.3%

HERE ARE SOME SCENARIOS 👇

1) CPI above 3.1%

THIS WILL BE A DAMAGE TO THE MARKET
GIVEN THAT THE LAST TIME THE CPI DATA… photo.twitter.com/yudjPLPl8g

— Ash Crypto (@Ashcryptoreal) July 11, 2024

Consumer Price Index Release: What Does It Mean for the Dollar and Bitcoin?

Inflation as measured by the consumer price index is a key determinant of the value of the US dollar. If the consumer price index declines more than expected, it could reinforce expectations of a rate cut by the Federal Reserve in September, thus weakening the dollar. A weaker dollar could benefit GBP/USD, which recently broke a major resistance level, and Bitcoin, which could see its price rise due to increased demand from institutional investors.

Current forecasts suggest that headline inflation will decline to 3.1%, with core inflation holding steady at 3.4%. However, a surprise increase in the consumer price index could upset these expectations. Fed Governor Lisa Cook has mentioned the possibility of a soft landing for the economy, with inflation falling without a significant increase in unemployment, which could lead the Fed to consider rate cuts. This outlook is particularly favorable for stock markets and cryptocurrencies, including Bitcoin, which could benefit from a more accommodative monetary policy.

According to experts at 10x Research, especially their CEO Markus Thielen, Bitcoin could see a significant increase if the CPI data confirms a decline in inflation. Thielen indicated that Bitcoin could reach almost $60,000, a prediction that has already been reflected with a rise to $59,350 before the data was released.

Therefore, Thursday’s CPI data could determine the future direction of financial and cryptocurrency markets. High inflation could strengthen the US Dollarwhile a drop in inflation could pave the way for rate cuts by the Fed, thus giving a boost to Bitcoin and other digital assets.

Enhance your Cointribune experience with our Read to Earn program! Earn points for every article you read and access exclusive rewards. Sign up now and start earning rewards.

Click here to join “Read to Earn” and turn your passion for cryptocurrencies into rewards!

Avatar of Luc Jose A.

Luke Jose A.

A graduate of Sciences Po Toulouse and holder of a blockchain consultant certification issued by Alyra, I joined the Cointribune adventure in 2019. Convinced of the potential of blockchain to transform many sectors of the economy, I am committed to raising awareness and informing the general public about this ever-evolving ecosystem. My goal is to enable everyone to better understand blockchain and seize the opportunities it offers. Every day, I strive to provide an objective analysis of the news, decipher market trends, convey the latest technological innovations and put into perspective the economic and social issues of this ongoing revolution.

DISCLAIMER

The views, thoughts and opinions expressed in this article are solely those of the author and should not be construed as investment advice. Do your own research before making any investment decisions.

Source

News

Crowd Expects Bitcoin Bounce Suggests Further Losses, As RCO Finance Resists Crash

Published

7 months ago

11 July, 2024

FinCrypt Staff

Crowd Expects Bitcoin Bounce Suggests Further Losses, As RCO Finance Resists Crash

Bitcoin is seeing a rebound after its recent price crash to $53,000. Other altcoins are subsequently recovering, with many cryptocurrency investors increasingly making new entries. However, Santiment warned against this hopium, suggesting that Bitcoin could extend its price losses.

As the broader market anticipates Bitcoin’s next price action, RCO Finance (RCOF) demonstrates resilience, attracting thousands of people in influxes. Read on for more details!

RCO Finance challenges the market crisis

RCO Finance (RCOF) is approaching $1 million in funding raised, amid growing interest from institutional traders seeking stability from Bitcoin’s wild price swings. While much of the broader market has seen significant price losses, RCO Finance has remained resilient, experiencing a surge in its pre-sale orders.

As a result, the project seems oblivious to the current market conditions, leading top market experts to take a deep dive into its ecosystem. They identified why RCO Finance was able to withstand the bearish pressure and its potential to hold up even stronger during the impending broader market crash.

The main reason was related to the innovative use of RCO Finance AI Trading Tools as a Robo Advisor. This tool has been integrated into RCO Finance’s cryptocurrency trading platform, offering full automation and highly accurate market forecasts to help investors make informed decisions.

Read on to learn more about this tool and other exciting features of RCO Finance!

Bitcoin Bounces Amid Impending Crash

Bitcoin is bouncing back, rallying 8% after plunging to its lowest point since February on July 5. While this rebound has triggered a bullish wave in the broader market, many cryptocurrency analysts predict it could be short-lived as Bitcoin is poised for an imminent crash toward the $50,000 zone.

On a Post X (formerly Twitter)Santiment revealed that while the crowd is anticipating a Bitcoin rally, this potential crash could trigger FUD and panic, causing average traders to wither and give up on Bitcoin. The platform noted that Bitcoin rally has historically occurred after these weak hands sold their holdings.

In particular, these cryptocurrency analysts speculate that the previous and upcoming Bitcoin crash is largely the result of bearish market psychology, as opposed to large BTC sell-offs by the German government and Mt. Gox. In particular, Ki Young Ju, founder and CEO of CryptoQuant, noticed that “the sales were rather negligible, given the overall liquidity of Bitcoin.”

Enjoy seamless investing on RCO Finance

RCO Finance is making investing easier and easier, democratizing access to high-level tools and cryptocurrency earnings that were once reserved for professional and institutional investors. It has also prioritized accessibility, allowing investors of all levels to easily navigate its features through its intuitive interface.

Additionally, they can also maintain anonymity and privacy as the platform has no KYC requirements. To build trust, the platform has instead emphasized regular smart contract audits by respected security firm SolidProof.

Performance data shows massive adoption, indicating that it is doing its job effectively. Investors can also capitalize on RCO Finance’s fast transaction speeds and incredibly low transaction fees, with leverage options up to 1000x to further optimize their portfolios and maximize returns.

Leverage RCO Finance’s pre-sale earnings

An in-depth analysis of the RCO Finance ecosystem revealed that it has strong potential to rival and surpass major cryptocurrencies in the cryptocurrency industry. With a very limited total token supply and excellent tokenomics, RCO Finance is poised to reach its target of $1 billion in market cap upon its official launch.

RCO Finance has adopted a deflationary model, strategic burn mechanisms, and a vesting schedule. However, the project encourages long-term holding by focusing on sustained growth through incredibly high staking rewards.

RCOF tokens are currently available at an altcoin price of $0.01275 in progress Pre-sale Phase 1. This is likely the lowest price these coins will ever trade at, as they are expected to increase exponentially with each new presale phase.

With RCOF expected to be $0.4 at launch, investors jumping in now can expect a Return 30x on their investment!

For more information on RCO Finance (RCOF) presale:

Visit RCO Finance Pre-sale

Join the RCO Financial Community

Disclaimer: The statements, views and opinions expressed in this article are solely those of the content provider and do not necessarily represent those of Crypto Reporter. Crypto Reporter is not responsible for the reliability, quality and accuracy of any material in this article. This article is provided for educational purposes only. Crypto Reporter is not responsible or liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Do your own research and invest at your own risk.

Source

News

Bitget Ranks Third Among Cryptocurrency Exchanges by Capital Inflows in Q2

Published

7 months ago

11 July, 2024

FinCrypt Staff

Although Bitget is not the largest cryptocurrency exchange in terms of total volumes, it closed a favorable quarter. From April to June, the platform ranked third in net capital inflows and showed the strongest growth in market share compared to its competitors.

In the second quarter, investors moved $700 million into Bitget, and activity on the platform increased by nearly 50%.

The exchange has seen a surge in user funds, with Bitcoin (BTC), Tether (USDT), and Ethereum (ETH) rising 73%, 80%, and 153%, respectively, in the first six months of the year. This growth coincided with adding 2.9 million new users to the platform.

This has positioned Bitget among the top exchanges with the highest positive net inflows in the last quarter. Only Binance, which remains the market leader, and Bitfinex have performed better in this category.

According to CCData’s latest H2 Outlook Report, the exchange also recorded the highest market share growth among centralized exchanges, increasing 38.4% from H2 2023 to H1 2024.

Bitget’s spot trading volume has also seen a visible increase, going from $28 billion in Q1 to $32 billion in Q2, marking an increase of over 10%. The platform’s monthly visitors have reached 10 million. Although its volumes are increasing, Bitget still does not rank among the top 10 cryptocurrency exchanges in terms of spot trading.

The changes taking place in the centralized cryptocurrency exchange market show that competition is becoming more and more intenseAn example of this is the recent surge in popularity of Bybit, which has become the second largest exchange in terms of spot trading volumes.

Sports Sponsorships and New Products

Gracy Chen, Source: LinkedIn

Gracy Chen, CEO of Bitget, commented on the quarterly performance, saying, “Q2 2024 was a pivotal period for Bitget. Our collaboration with Turkish athletes, along with significant growth in users and website traffic, is part of our global expansion.”

In an effort to expand its global presence, Bitget has partnered with three Turkish national athletes as part of its #MakeItCount campaign, starring Lionel Messi. The deal with the famous footballer It was signed in Februaryto build brand presence in Latin America.

The exchange also launched a $20 million TON Ecosystem Fund in partnership with Foresight Ventures to support early-stage projects on The Open Network.

The exchange introduced two new initial token listing products, PoolX and Pre-market, which collectively launched over 100 projects. Additionally, Bitget’s native token, BGB, was recognized as the best-performing centralized exchange token in June and was ranked among the top 10 cryptocurrencies by Forbes.

In its latest move, the cryptocurrency exchange aimed to become a regulated player in IndiaThe announcement comes as the world’s most populous democracy grapples with the complexities of integrating cryptocurrencies into its financial ecosystem.

Even recently,
Bitget Wallet Announced a joint investment with cryptocurrency investment firm Foresight X in Tomarket, a decentralized trading platform. This initiative targets emerging asset classes and aims to expand the portfolio’s services beyond traditional decentralized exchanges (DEXs).

In the second quarter, investors moved $700 million into Bitget, and activity on the platform increased by nearly 50%.

According to CCData’s latest H2 Outlook Report, the exchange also recorded the highest market share growth among centralized exchanges, increasing 38.4% from H2 2023 to H1 2024.

The changes taking place in the centralized cryptocurrency exchange market show that competition is becoming increasingly intenseAn example of this is the recent surge in popularity of Bybit, which has become the second largest exchange in terms of spot trading volumes.

Sports Sponsorships and New Products

Gracy Chen, Source: LinkedIn

The exchange also launched a $20 million TON Ecosystem Fund in partnership with Foresight Ventures to support early-stage projects on The Open Network.

Source