Top 2 Crypto Stocks to Invest in for the Blockchain Boom 2023
Two Promising Crypto Stocks Set to Thrive Amid blockchain Growth
Bitcoin’s Surge and Its Impact on Crypto Stocks
Bitcoin has recently achieved an all-time high, enhancing the appeal of cryptocurrency stocks. This article highlights two companies poised to capitalize on the blockchain expansion and potentially yield significant returns in the coming year.
Coinbase: Leading the Charge in Cryptocurrency Exchange
With a market capitalization of approximately $90 billion, Coinbase (NASDAQ: COIN) stands as the largest cryptocurrency exchange in the United States. The company is transitioning from a platform primarily serving retail investors to a crucial player in the infrastructure of digital assets.
Coinbase’s growth in the institutional sector is remarkable. The firm manages assets for a significant portion of Bitcoin and Ethereum ETFs, which have collectively garnered over $120 billion in just a year and a half.
The company’s “Crypto-as-a-Service” model now supports over 200 financial institutions, including a partnership with BlackRock’s Aladdin platform, showcasing the increasing reliance of traditional finance on Coinbase’s services.
The recent acquisition of Deribit for $2.9 billion marks a historic milestone in the crypto industry, granting Coinbase a dominant 75% share in options trading. This acquisition completes its derivatives offerings, which include spot and futures trading, addressing the fact that a substantial portion of global crypto activity is in derivatives. The nature of options trading ensures consistent revenue across various market conditions.
Additionally, the rise of stablecoins is expected to drive significant growth, with USDC balances on Coinbase tripling over the past two years. The company views payment solutions as the next significant opportunity, as businesses increasingly adopt cryptocurrency for faster and more cost-effective global transactions. Coinbase is already utilizing USDC for its internal vendor payments.
With the total addressable market for cryptocurrencies expanding rapidly and Coinbase’s 13-year head start in developing proprietary technology, the company is well-positioned to capture substantial value as digital assets gain mainstream acceptance.
Recently included in the S&P 500 Index, Coinbase’s stock has surged nearly 600% over the past three years. Analysts predict that its adjusted free cash flow will rise from $2.55 billion in 2024 to $3.3 billion in 2025. If the stock is valued at 40 times its trailing free cash flow, it could see an increase of over 45% within the next eight months.
Hive Digital: A Green Energy Leader in Crypto Mining
Hive Digital (TSXV: HIVE), with a market cap of $610 million, specializes in building and operating data centers powered by renewable energy across Canada, Sweden, Iceland, Switzerland, and Paraguay.
Hive Digital has experienced a transformative fiscal year 2025 (ending in March), positioning itself as a dual player in Bitcoin mining and high-performance computing. The company reported $115 million in revenue and $56 million in adjusted EBITDA, demonstrating strong performance amid changing market conditions.
A key highlight is Hive’s rapid scaling, with its hash rate increasing from 4.7 exahashes to 11.5 exahashes, and management aims to reach 25 exahashes by November. This growth is fueled by strategic expansion in Paraguay, leveraging competitively priced green hydroelectric energy. The company anticipates annualized revenue of $400 million at a Bitcoin price of $100,000.
Hive’s AI computing division, through its subsidiary Buzz, has achieved a $20 million annual run rate, doubling in just six months. The recent acquisition of a 7.2-megawatt data center in Toronto will enhance its high-performance computing capacity by 3.5 times, targeting $100 million in annualized revenue by 2026.
With an industry-leading 22% return on invested capital and the lowest operational costs per Bitcoin mined in the sector, Hive combines operational efficiency with significant growth potential as demand for both Bitcoin and AI infrastructure continues to rise.
Conclusion: The Future of Crypto Investments
As the cryptocurrency landscape evolves, both Coinbase and Hive Digital are strategically positioned to benefit from the ongoing blockchain boom. Investors should consider these companies as they navigate the rapidly changing digital asset market.
Before making any investment decisions, it’s essential to conduct thorough research. The Motley Fool’s Stock Advisor Canada team has identified several top stocks for 2025 and beyond, which may offer substantial returns. Notably, Bitcoin was not included in their top picks, emphasizing the need for careful consideration when investing in cryptocurrencies.
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