Cryptocurrencies have rapidly evolved from a niche concept to a mainstream investment, capturing significant attention from both individual and institutional investors.
In 2012, markets for digital currencies like Bitcoin (BTC) were barely recognized. However, the sector expanded into a massive industry, reaching a peak market value of $3 trillion in the fall of 2021. The sudden surge created substantial wealth for early investors, and the market bounced back. Investors are eager to identify the next Bitcoin or Ethereum, with numerous cryptocurrencies and innovative companies seeking to integrate digital blockchain technology into society.
Digital currency companies offer major potential. The core concept behind blockchain technology is to establish a secure, peer-to-peer electronic payment system that’s efficient, secure and borderless. Investors have options: they can purchase cryptocurrencies directly or invest in companies that benefit from the growth of blockchain and crypto assets, which are becoming more and more popular. Companies adopting blockchain technology, particularly in finance, may gain a considerable edge when processing payments given the increased popularity of utilizing digital assets.
One option for gaining exposure is through exchange-traded funds (ETFs) tracking Bitcoin’s spot price. Eleven such funds were approved in January 2024, including the iShares Bitcoin Trust (IBIT) and the Fidelity Wise Origin Bitcoin Trust (FBTC).
However, investments in this sector are subject to significant market swings. The sector’s peak value of $3 trillion dropped to less than $1 trillion in June 2022, as inflation drove investors away from high-risk investments. It’s essential to only invest funds you don’t need in the short term, considering the crypto market’s volatility.
Here are some prominent crypto and crypto-related stocks to consider:
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Coinbase Global: Coinbase Global (COIN), a leading cryptocurrency trading exchange, went public in April 2021. The platform facilitates trading in about 250 cryptocurrencies, including major currencies like Bitcoin, Ethereum, and Cardano (ADA). Coinbase earns transaction fees from each trade but aims to expand beyond trading. The company has a debit card allowing consumers to spend from their digital wallet. It has also created a cloud platform for business using and storing digital currencies.
Coinbase offers innovations that are transforming the sector. Firstly, it offers asset loans, which allows users to pledge their Bitcoin or other cryptocurrencies as collateral to secure a low-interest loan, enabling them to keep assets instead of selling when emergencies arise. Secondly, governments and financial institutions are adopting Coinbase’s blockchain analytics to monitor data for illicit transactions, building greater trust in crypto by aiding law enforcement. This type of service is essential for building confidence in the crypto sector.
Investing in Coinbase is a broad bet on the crypto market. If crypto trading gains traction long-term, Coinbase and its shareholders are well-positioned to benefit.
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Block and PayPal Holdings: Block (formerly Square) and PayPal (PYPL) have spotted a significant opportunity in allowing users to buy and hold cryptocurrencies within a wallet, with Block’s Cash App allowing Bitcoin trading since 2017. For Block, Bitcoin trading often generates substantial revenue, and the company helps foster the use of Bitcoin among its business users.
PayPal’s Venmo app launched crypto trading in early 2021, offering similar services, and could become a leading cryptocurrency platform due to its extensive user base. Venmo is a solid access point for those who wish to buy major cryptocurrencies and then can use those holdings to buy altcoins or use decentralized finance (DeFi) applications. Notably, the absence of central intermediaries in digital payment protocols drives down the costs of operations.
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Canaan and Hut 8 Mining: Companies such as Canaan (CAN) design ASIC (application-specific integrated circuit) machines for brute-force calculations for proof-of-work cryptocurrencies. These machines offer greater efficiency than traditional graphics processing units (GPUs). Canaan’s Avalon ASICs can perform an enormous number of hash guesses per second, validating blocks on the Bitcoin network. Sales have increased due to the device’s affordability and low energy consumption, leading to higher profit margins for miners. Bitcoin mining has become a crucial component of the digital currency infrastructure.
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Strategy: The company formerly known as Microstrategy (MSTR) has focused on cryptocurrency operations, primarily involving Bitcoin. In February 2025, the company had 478,740 Bitcoins on its balance sheet. Strategy plans to raise funds through loans and stock sales to acquire even more Bitcoin, a risky yet potentially rewarding strategy based on the underlying value of Bitcoin.
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Robinhood Markets: Robinhood Markets (HOOD) is a popular discount brokerage offering commission-free trading in stocks, options, and cryptocurrencies. Several cryptocurrencies, including Bitcoin, Ethereum, and Dogecoin (DOGE), are available commission-free, and the company holds billions of dollars in crypto assets. Robinhood is positioned for growth by scaling the number of cryptocurrencies on its platform. By offering crypto analytics services like Coinbase, Robinhood aims to boost trust and adoption in the sector.
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CME Group: CME Group (CME) is the world’s largest financial derivatives exchange. It provides markets for futures and options, and it established the first market for Bitcoin futures at the end of 2017. Options on Bitcoin futures followed in early 2020. Ethereum is another option, and the group continues to expand its crypto offerings. This approach provides legitimacy and a way for digital currency owners to mitigate the risks of price changes. The company continues to provide services as one of the largest derivatives exchanges in the world.
The beauty of cryptocurrency stocks is that most of them are not pure plays, allowing investors the benefit of diversification. Companies in the crypto sector, however, can experience volatile swings in revenue and earnings. Still, the crypto realm is gaining mainstream adoption. Investing in digital currencies is a long-term strategy, and these stocks may offer a more measured approach than investing directly in cryptocurrencies themselves. As the regulatory landscape evolves, the companies listed above are poised to become more successful.
