4 most reactive stocks riding the crypto movement

By Pavithra R

Stake, a financial trading platform, has polled more than 5,000 international traders to discover what their attitudes are towards cryptocurrency following Bitcoin reaching a record-high in April and the volatility that has ensued. The firm found out that over the years, some stocks have become more obviously correlated to the rise and fall of cryptocurrencies than others. Stocks such as these can allow investors to ride the crypto wave without actually investing in it. Below is a list of 4 key stocks identified as most reactive to crypto movements:

1. Coinbase

This cryptocurrency exchange platform provides the most obvious and direct exposure to the world of crypto without directly investing in the currencies themselves. This has made Coinbase being the most popular IPO when it listed earlier this year. 117% quarter over quarter customer growth saw Coinbase’s 56m users contribute US$1.8b in Q1 2021 revenue.

2. MicroStrategy

Internet services firm MicroStrategy has become a weak proxy for $BTC exposure. In August 2020 the company announced they would be purchasing US$425 worth of Bitcoin at around US$12k. Michael Saylor, $MSTR’s CEO calls the move a pure play on the future significance and value of $BTC rather than any form of gamble or hedge. The company has been adding to the position since.

3. Chipmakers

Makers of high-end chips like Nvidia, AMD and Micron have historically benefited from the crypto-mining book. They manufacture the powerful processors used to solve the cryptographic puzzles that yield new cryptocurrency. In Q1 2021, Nvidia did $155m for their crypto-specific GPUs.

4. Square

Like PayPal, payments company Square has bet big on crypto, investing money in cryptocurrency technology. Pointing towards what other forms of innovation can be expected, Square won a patent last year to establish a fiat to crypto payment network. Moreover, 5% of the company’s cash has been invested into Bitcoin over the last year. Since spring, Square has emerged as one of the most popular equities, featuring in the top 10 most traded stocks on Stake for several weeks.

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