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4 Solid Crypto Stocks to Bet on Ahead of Bitcoin’s Next Rally
The cryptocurrency rally came to an abrupt end in April, after a strong 2023 and first quarter. The first quarter saw Bitcoin (BTC), the world’s most popular cryptocurrency, reach an all-time high of $73,750.
However, Bitcoin has since fallen sharply, with its price hovering around $68,000 on May 23. In fact, Bitcoin has fallen 15% since hitting an all-time high on March 14.
One of the main reasons for the decline is the recently concluded halving event, which occurs once every four years. The halving event halves the block reward, with the goal of limiting the total supply of Bitcoin to 21 million coins. As a result, the reduced rate of new issuance of Bitcoin typically leads to an increase in demand for the cryptocurrency, which in turn tends to drive up its price.
Additionally, Wall Street suffered in April after its first-quarter rally as concerns about rising inflation grew. This caused optimism about rate cuts to quickly fade as investors feared the Federal Reserve might keep interest rates higher for a longer period.
High interest rates negatively impact growth assets such as technology stocks, consumer discretionary stocks and cryptocurrencies.
However, Bitcoin still has a lot of potential. Year to date, Bitcoin has gained 54% after rising 207% in 2023. The halving event has also ended.
Additionally, the cryptocurrency has jumped more than 50% since the launch of the first Bitcoin ETFs in early January.
Minutes from the Federal Reserve’s FOMC meeting from April 30 to May 1 revealed that several officials favor raising interest rates if needed, as inflation is still above its 2% target.
However, recent economic data showed that inflation fell in April after rising in the first quarter. The consumer price index (CPI) rose 0.3% month-on-month in April, lower than economists’ expectations of a 0.4% increase. Year over year, the consumer price index increased by 3.4%.
Furthermore, UJS GDP grew only 1.6% in the first quarter after growing 3.4% in the last quarter of 2023. Furthermore, retail sales remained stable in April after increasing by 0 .3% in March, while manufacturing and services activity also slowed last month.
These signs of a slowing economy have raised hopes that the Federal Reserve may soon initiate interest rate cuts, which would help the cryptocurrency market.
Our choices
We have narrowed our search to four cryptocurrency-oriented stocks that have strong potential for 2024. Each of our picks has a Zacks Rank #1. 1 (Strong Buy), 2 (Buy) or 3 (Hold). you can see the complete list of today’s Zacks #1 Rank stocks here.
The story continues
NVIDIA Corporation NVDA is a major player in the semiconductor industry and has been one of the biggest success stories of 2023. As a leading designer of graphics processing units (GPUs), NVDA stock value tends to rise in a thriving cryptocurrency market . This is mainly due to the crucial role that GPUs play in data centers, artificial intelligence, and cryptocurrency mining or production.
NVIDIA’s forecast earnings growth rate for the current year is 89.2%. The Zacks Consensus Estimate for current-year earnings has improved 2.5% over the past 60 days. NVIDIA currently sports a Zacks Rank of #1. 1.
Robinhood Markets, Inc. HOOD operates a financial services platform in the United States. Its platform allows users to invest in stocks, exchange-traded funds, options, gold and cryptocurrencies. HOOD buys and sells Bitcoin, Ethereum, Dogecoin and other cryptocurrencies using its Robinhood Crypto platform.
Robinhood Markets’ forecast earnings growth rate for the current year is 198.4%. The Zacks Consensus Estimate for current-year earnings has improved 160.9% over the past 60 days. Robinhood Markets currently has a Zacks Rank #2.
Coinbase Global, Inc. COIN offers financial infrastructure and technology to support the global cryptocurrency economy. COIN provides a primary financial account for consumers in the crypto space, a liquidity marketplace for institutional transactions of crypto assets, and technology and services for developers to build cryptocurrency-based applications and securely accept cryptocurrencies as payment.
Coinbase Global’s forecast earnings growth rate for the current year is over 100%. The Zacks Consensus Estimate for current-year earnings has improved 357.3% over the past 60 days. Coinbase currently sports a Zacks Rank #1. 1.
Interactive Brokers Group, Inc. IBKR is a global automated electronic broker. IBKR executes, processes and trades cryptocurrencies. IBKR’s commodity futures trading desk also offers clients the ability to trade cryptocurrency futures.
Interactive Brokers Group expects an expected earnings growth rate of 12.9% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 6.9% over the past 60 days. IBKR currently carries a Zacks Rank #2.
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Interactive Brokers Group, Inc. (IBKR) – Free Stock Analysis Report
NVIDIA Corporation (NVDA) – Free stock analysis report
Coinbase Global, Inc. (COIN) – Free stock analysis report
Robinhood Markets, Inc. (HOOD) – Free stock analysis report