Janice R. Andrews
Over the past three months, there has been volatility in the cryptocurrency market, with Bitcoin (BTC) witnessing a notable decline following its all-time high in March. The price of Bitcoin as of July 3 is a little over $58,600, a significant decrease from its peak of $73,750.07 on March 14. There are strong reasons to think about including Bitcoin equities in your portfolio before the next rebound, even in light of this dip.
The Latest Performance of Bitcoin
In 2023, Bitcoin experienced a remarkable upswing, rising by 157%. When 11 spot Bitcoin exchange-traded funds (ETFs) were approved by the Securities and Exchange Commission (SEC) in January, the year got off to a great start. The surge was fueled by this permission, which gave institutional and ordinary investors alike a regulated and easily accessible way to invest in Bitcoin. A recent CCData study states that these ETFs have had net inflows of about $14.41 billion since they were approved.
The Market Impact and the Halving Event
With the start of the Bitcoin halving event in April—a momentous occasion that occurs every four years—the rally came to a halt. In order to keep the total amount of Bitcoin at 21 million coins, the block reward is being halved by 50%. This decrease in the quantity of fresh Bitcoins available usually boosts demand and drives up prices. Since the full impacts of the halving event have not yet worn off, the recent decline in the price of Bitcoin is considered to be transitory.
Market projections and economic factors
The announcement made by Federal Reserve Chairman Jerome Powell following the June FOMC meeting that the Fed will only be cutting rates once this year, as opposed to three as predicted in March, further changed the dynamics of the market. Positive reactions have been seen to this single 25 basis point rate reduction, particularly considering that many market players had previously anticipated no rate reductions in 2024.
Moreover, the most recent FOMC “dot plot” predicts that interest rates will decline by a cumulative 1% by 2025, implying that the Fed funds rate may fall to 4.1% by that time. This is good news for the economy as a whole and for industries like manufacturing. A rate drop in September is now priced into the markets, which is expected to stimulate the cryptocurrency market. Growth assets like consumer discretionary companies, technology equities, and cryptocurrency tend to profit from lower interest rates.
The Best Bitcoin Stocks to Buy
We have chosen four crypto-focused stocks with great potential for 2024, given these favorable conditions. Zacks rates all of these stocks as either #1 (Strong Buy) or #2 (Buy).
The NVIDIA Corporation
Leading global provider of visual computing solutions, NVIDIA Corporation is the creator of the graphics processing unit (GPU). NVIDIA has shifted its emphasis from PC graphics over time to AI-based solutions that enable virtual reality, gaming, and high-performance computing.
The expected earnings growth rate for the current year is 106.2%. The Zacks Consensus Estimate for Improvement over the Last 60 Days is 12.1%. The stock is ranked #1 (Strong Buy) by Zacks.
Markets Robinhood, Inc. (HOOD)
In the US, Robinhood Markets runs a financial services platform that lets customers buy stocks, ETFs, options, gold, and cryptocurrency. It makes it easier to buy and trade cryptocurrencies like Dogecoin, Ethereum, and Bitcoin through its Robinhood Crypto platform.
Zacks Consensus Estimate Improvement: 93.1% over the previous 60 days
Expected Earnings Growth Rate: Over 100% for the current year Zacks Rank: #2 (Buy)
(IBKR) Interactive Brokers Group, Inc.
Global automated electronic broker Interactive Brokers Group offers cryptocurrency trading, processing, and execution. With its commodities futures trading desk, it provides clients with the option to trade bitcoin futures as well.
Zacks Consensus Estimate Improvement: 1.4% over the previous 60 days
Expected Earnings Growth Rate: 16.2% for the current year Zacks Rank: #2 (Buy)
Global, Inc. Coinbase (COIN)
Technology and financial infrastructure are supplied by Coinbase Global to help the global bitcoin economy. It provides institutional investors with a marketplace where they can transact in cryptocurrency assets with liquidity, as well as technology and services that enable developers to create applications based on cryptocurrencies and safely accept them as payment.
Zacks Consensus Estimate Improvement: 2.6% over the previous 60 days
Expected Earnings Growth Rate: Over 100% for the current year Zacks Rank: #1 (Strong Buy)
The long-term picture for Bitcoin and the larger cryptocurrency sector is still favorable, notwithstanding the recent turbulence. As the halving event’s impacts and the positive state of the economy play out, Bitcoin is probably going to see a comeback. Putting money into leading Bitcoin stocks, such as Coinbase Global, Interactive Brokers Group, NVIDIA, and Robinhood Markets, could set your portfolio up for success in the upcoming rise.
