Blockchain stocks offer a less confronting method of buying into the growth potential inherent in cryptocurrency. The stock market is a well-known entity overall. Investors are comfortable with it as an entry point for their capital. That might be different when it comes to the crypto market. Exchanges are an entirely different beast altogether.
That is one of many reasons blockchain stocks make an attractive investment. They’re a bridge between the known and the unknown and offer diversification in general. In time, these firms can pivot into more substantial blockchain investments should things take off. Let’s look at a few stocks providing that type of investment.
Intel (INTC)
Intel’s (NASDAQ:INTC) stock has grown this year due to its association with AI and the potential therein. The company continues to contract based on top-line results while undertaking cost-cutting efforts that have had some positive effects in Q2. That’s generally what investors should know about Intel overall.
However, Intel is less often associated with another growth opportunity outside AI. That opportunity is blockchain. For now, the future of Intel’s blockchain remains in the air. The firm introduced Bitcoin (BTC-USD) mining chips last year to capitalize on trends. Then, less than a year later, in mid-April of 2023, the firm announced it was discontinuing its production.
The so-called Blockscale chips will continue to be sold through October while Intel continues to reassess opportunities in the space. Part of the problem was simply timing. Bitcoin prices fell by more than half between Intel announcing and shipping the chip. Bitcoin traded below $20k at that point. Intel has been very quiet about the decision, but given that prices are again near $30k, Intel could make another run at it. Therefore, Intel is a hybrid blockchain/AI chip stock that could entice investors.
MicroStrategy (MSTR)
MicroStrategy (NASDAQ:MSTR) sells analytics software tailored to various industries. The stock is differentiated from most other SaaS firms in that it holds a massive amount of Bitcoin in its treasury.
That ownership is so substantial that Bitcoin prices significantly influence the firm’s share prices. MicroStrategy holds nearly 153,000 Bitcoins at this point. That amounts to $277 of value for each of its shares which currently trade for $375. Again, as Bitcoin goes, so too goes MicroStrategy.
What’s particularly interesting is that MicroStrategy appears to be winning concerning its BTC holdings. They were purchased at an average price of $28,233, roughly $1,000 below Bitcoin prices. MicroStrategy’s business is relatively flat and contracted by 1% in the second quarter. Frankly, it doesn’t matter much at all. Its Bitcoin holdings much more influence MSTR shares than its business operations. Pundits predict that Bitcoin will continue to rise as distrust in fiat currency increases. Given the recent downgrade to U.S. creditworthiness, there’s reason to believe that could occur soon.
Block (SQ)
Block (NYSE:SQ) is primarily known as a fintech stock, but the firm’s operations also touch on blockchain significantly. The company is clearly invested in the development of blockchain technology because it rebranded to its current name after beginning as Square.
I won’t discuss its blockchain business in great depth here. Instead, I’d like to note that Block has just entered a period of opportunity. Share prices plummeted as expectations of less robust EBITDA growth in the second half caused a selloff. The reaction was overdone following concern around PayPal’s (NYSE:PYPL) earnings the day before. There’s a negative multiplier effect in play.
Block grew while its losses narrowed. Sales exceeded expectations. Block is a contrarian play at the moment. Fintech stocks will continue to attract investment simply due to the growth expectations for the next decade. Block is among the largest, and its Bitcoin holdings make it much more enjoyable.
On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
