The cryptocurrency market has struggled to recover, but enthusiasm over interest rate cuts has helped push the world's most popular cryptocurrency, Bitcoin (BTC), above $60,000 for the first time since last month.
Bitcoin has faced some headwinds over the past few months, but market experts believe that a rate cut could resume the cryptocurrency’s upward trajectory. Given this scenario, it would be ideal to adopt a buy-low approach. Here are four Bitcoin-centric stocks that are set to rise: Interactive Brokers Group, Inc. IBKR, Robinhood Markets Inc. Food, CME Group Inc.CME, BlackRock Inc. BLK and NVIDIA Corporation It's NVDA.
Bitcoin surges on hopes of interest rate cut
On Tuesday, Bitcoin traded at $60,477.98 after hitting an intraday high of $61,337. The surge came as the Federal Reserve began its two-day FOMC meeting, raising expectations that an interest rate cut would be announced on Wednesday.
Bitcoin has been in a range since April, and the halving did not boost its price. The halving, which cuts the mining reward for new Bitcoin blocks by 50% and limits the total supply to 21 million, typically increases demand and prices. However, after the recent halving, Bitcoin's value dropped significantly.
A market-wide crash in early August pushed the price of Bitcoin below $55,000, after which the cryptocurrency has been trying to recover.
Interest rate cut boosts cryptocurrency stocks
Expectations for a 50 basis point rate cut from the Federal Reserve have ebbed somewhat following a weak August jobs report and a slight increase in monthly inflation. The CME FedWatch tool currently indicates a 63% chance of a 25 basis point rate cut this week, and a 37% chance of a 50 basis point rate cut.
Bitcoin is shaping up strongly in 2023, up 43% year-to-date despite recent declines, hitting an all-time high of $73,750 on March 14.
Interest rate cuts are likely to favor Bitcoin and other cryptocurrencies. Regardless of the size of the cut, interest rate cuts bode well for growth assets like cryptocurrencies as they reduce the opportunity cost of holding non-yielding assets. In a low interest rate environment, investors tend to choose assets with higher potential returns even at the expense of increased risk.
5 cryptocurrency stocks to make money from
We have narrowed down our list to five cryptocurrency-related stocks that we believe have great potential for 2024. Each of them carries a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can see the complete list of today's Zacks #1 Rank stocks here.
Interactive Brokers Group, Inc.
Interactive Brokers Group, Inc. is a global automated electronic broker. IBKR executes, processes and trades cryptocurrencies. IBKR's commodity futures trading desk also offers clients the opportunity to trade cryptocurrency futures.
Interactive Brokers Group's expected earnings growth rate for the current fiscal year is 18.4%. The Zacks Consensus Estimate for its current fiscal year earnings has moved 0.7% higher over the past 60 days. IBKR currently has a Zacks Rank #2.
Robinhood Markets Inc.
Robinhood Markets Inc. It operates a financial services platform in the U.S. Its platform allows users to invest in stocks, exchange-traded funds, options, gold, and cryptocurrencies. HOOD uses its Robinhood Crypto platform to buy and sell Bitcoin, Ethereum, Dogecoin, and other cryptocurrencies.
Robinhood Markets' current fiscal year expected earnings growth rate is over 100%. The Zacks Consensus Estimate for current fiscal year earnings has moved 38.2% higher over the past 60 days. Robinhood Markets currently has a Zacks Rank #2.
CME Group Inc.
CME Group Inc.Options give the call/put buyer the right to buy/sell cryptocurrency futures contracts at a specific price on a specific date in the future. CME offers options on Bitcoin and Ethereum based on the exchange's cash-settled standard and micro Bitcoin and Ethereum futures contracts.
CME Group's expected earnings growth rate for the current fiscal year is 6.4%. The Zacks Consensus Estimate for its current fiscal year earnings has moved 1.5% higher over the past 60 days. CME currently has a Zacks Rank of 3.
BlackRock Inc.
BlackRock Inc. BLK is one of the world's largest investment management firms and publicly listed companies. BLK was one of the first companies from the traditional market to join the Bitcoin ETF race in June 2023.
BlackRock's expected earnings growth rate for the current fiscal year is 9.5%. The Zacks Consensus Estimate for current fiscal year earnings has moved 10.3% higher over the past 60 days. BlackRock currently carries a Zacks Rank #3.
NVIDIA Corporation
NVIDIA Corporation is a world leader in visual computing technology and the inventor of the graphics processing unit (GPU). Over the years, NVDA's focus has evolved from PC graphics to artificial intelligence-based solutions supporting high-performance computing, gaming and virtual reality platforms.
NVIDIA's expected revenue growth rate for the current fiscal year is over 100%. The Zacks Consensus Estimate for its current fiscal year earnings has moved 4.1% higher over the past 60 days. NVDA currently has a Zacks Rank #3.
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CME Group Inc. (CME) : Free Stock Analysis Report
BlackRock Inc. (BLK) : Free Stock Analysis Report
Interactive Brokers Group (IBKR): Free Stock Analysis Report
NVIDIA Corporation (NVDA) : Free Stock Analysis Report
Robinhood Markets, Inc. (HOOD) : Free Stock Analysis Report
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