Where to buy cryptocurrency stocks?
What are cryptocurrency stocks?
Cryptocurrency stocks refer to shares in publicly traded companies associated with cryptocurrency and blockchain technology; these companies either operate crypto exchanges, invest in digital assets themselves, or create hardware equipment used to mine Bitcoin and other crypto assets.
Investing in cryptocurrency stock provides users with an opportunity to participate in the crypto space without buying cryptocurrencies directly. This resembles a more traditional investment channel that still provides a certain level of exposure to the industry’s development.
Therefore, cryptocurrency stocks are typically considered by traders and investors who are already comfortable with stocks yet want some exposure to crypto assets.
Even though it might be a fusion of a traditional investment-related instrument with the cryptocurrency market, the performance of crypto stocks is associated with the crypto’s price movements and market volatility.
Digital assets vs. stocks - What is the difference?
Cryptocurrencies and stocks are fundamentally different financial instruments. While cryptocurrencies are digital tokens with a particular value, stocks are shares of ownership in publicly traded companies.
Stocks are traded on regulated stock exchanges, and cryptocurrencies are traded on crypto exchanges, either centralised or decentralised exchanges, which are still mainly unregulated. With the regulatory approval of Bitcoin-spot Exchange Traded Funds (ETFs), these two financial instruments became a bit closer.
The U.S. Securities and Exchange Commission approved the first spot Bitcoin ETF. To learn more about this, we suggest reading this article: 'Bitcoin spot ETFs are here. How do I buy Bitcoin ETFs?'.
However, unlike cryptocurrencies such as Bitcoin which were designed to be used eventually as an alternative form of money, stocks were never meant to be legal tender.
On the other hand, they have many things in common. For example, they are both volatile assets associated with speculation and typically highly liquid, meaning they are easy to be rapidly bought and sold.
Types of crypto stocks
When you buy cryptocurrency stocks, you do not buy crypto directly, but individual stocks in companies within the crypto industry. You can buy a few types of crypto stocks, so let's explain them briefly.
Stocks of cryptocurrency companies
The first way is to buy cryptocurrency stocks in publicly traded companies that are directly linked with the cryptocurrency sector.
Crypto exchanges
Cryptocurrency exchanges as digital platforms on which you can buy and sell crypto assets fall into this category as their primary business operations are linked to the crypto world. Crypto trading works much like brokering on the Internet where users' digital currencies can be traded for other currencies.
The list includes listed crypto exchanges that are important for the liquidity and accessibility of the crypto market. For example, Coinbase made its shares available to the public back in 2021.
There are nearly 600 global crypto exchanges where users can trade Bitcoin, Ethereum, and other digital assets, but they vary in trading fees, quality, and safety.
To gain insight into the crypto exchange trading fees of leading crypto exchanges, why not read this article: 'Crypto Exchange Fees - Binance, Coinbase, ByBit, Bitstamp, Crypto.com, OKex, Kraken, KuCoin, Gate.io, HTX'.
Mining companies
Another important part of this category refers to crypto mining companies. Mining refers to an activity essential for maintaining the blockchain and its security, and in return for their services, miners receive rewards.
Mining companies generate profits from operating cryptocurrency blockchains, providing the computational power required to process transactions and secure the network, and minting new crypto assets.
Several mining companies are publicly traded such as Marathon Digital Holdings, Hut 8 Mining, and Riot Platforms.
Mining hardware companies
To solve complex mathematical problems, miners need special hardware. Users that think that these needs will continue their growth, tend to invest in publicly traded companies that manufacture specialised hardware.
For example, NVIDIA and Advanced Micro Devices are examples of publicly traded companies in the aspect of mining hardware.
Stocks of companies engaged with crypto
Several publicly traded companies from different sectors, sometimes unrelated to cryptocurrencies, hold a broad amount of digital currencies on their corporate balance sheets or provide crypto-related services in addition to their main business activity.
Companies that invest in cryptocurrencies
These crypto-adjacent stocks are shares in companies that are not primarily focused on the crypto space but have significant engagements in the sector. Share prices of such companies are likely to correlate with crypto prices as well.
For example, the electric vehicle manufacturer Tesla and the financial company Block hold broad amounts of cryptocurrency on their balance sheets.
Companies that provide crypto-related services
Several publicly traded companies from divergent sectors use blockchain technology and digital currencies to provide innovative products and services.
For example, the famous tech company IBM utilises blockchain-based solutions to expand their products. Furthermore, several big e-commerce companies such as Amazon and Alibaba provide ‘blockchain as a service’ infrastructure to support supply chain finance, digital content ownership and product traceability.
The rise of financial technology influenced many companies dealing with financial services to use blockchain technology to enhance their services. For example, JPMorgan Chase leveraged blockchain technology to conduct more efficient cross-border transactions.
Shares in publicly traded crypto funds
There are several crypto funds in the market, such as Exchange Traded Funds (ETFs) as well as mutual funds. ETFs refer to passively managed funds that hold stocks or other financial assets, usually divided into different categories or sectors.
Some crypto ETFs own cryptocurrencies directly such as the Fidelity Advantage Bitcoin ETF (FBTC) or present a portfolio of publicly traded cryptocurrency stocks such as the Schwab Crypto Thematic ETF (STCE).
Crypto exchange-traded funds became an essential tool for investment objectives related to exposure to digital assets without the complexities of direct ownership. As of January 2024, the U.S. SEC approved 11 spot trading funds, marking an important milestone for the crypto sector. Crypto spot ETFs reflect the price of cryptocurrencies on crypto markets and provide a straightforward approach to investing in the marketplace.
On the other hand, mutual funds are defined as professionally managed funds that are organised around a particular theme or strategy. A cryptocurrency mutual fund may hold cryptocurrency directly, invest in cryptocurrency futures contracts or invest in publicly traded crypto stocks.
For example, Fidelity’s Bitcoin Strategy ProFund Investor Class fund (BTCFX) is a mutual fund that invests in Bitcoin futures.
Where to buy crypto stocks?
Don’t let the term cryptocurrency stock fool you – these stocks are traded the same as traditional stocks. You can buy cryptocurrency stocks using trading platforms that provide access to stock exchanges where these assets are listed or online brokerages.
Therefore, buying cryptocurrency stocks is easily accessible to users already familiar with the stock market.
How to buy crypto stocks?
Choose a trading platform or brokerage services
The process of buying cryptocurrency stocks starts with choosing between divergent trading or brokerage platforms. Once you select a preferred broker or trading platform, you can open and fund your account as well as provide all the necessary information for 'Know-Your-Customer' (KYC) processes. When your account is approved, you can deposit funds.
Before buying any stocks, do your research. Keep in mind that a significant difference between trading traditional and stocks of crypto-related companies is their regulatory environment.
Do your own research
Stocks as traditional financial instruments are traded on regulated exchanges which might provide an additional layer of security that is not always present on the crypto market. Check out companies with good fundamentals, transparency, and a link to the crypto industry, as well as if their performance history and growth potential align with your investment objectives.
Additionally, when users trade stocks, they don’t need to manage digital wallets, so you need to learn a bit more about the crypto space and its main perks if you want to obtain a certain degree of exposure to the crypto realm.
If you are just stepping into the crypto world, we suggest selecting one of the available courses on our Learn Crypto Academy.
Place orders and monitor your investments
Once you have chosen the cryptocurrency stocks you want to buy, decide on the amount you want to invest and place your orders. If you need immediate execution at current prices, you can use market orders, and if you want to specify the price you can pay, you can use limit orders.
Once you have purchased preferred cryptocurrency stocks, be sure to monitor your investments frequently. You can do that by keeping track of the performance of your investments through your chosen platform and staying informed about cryptocurrency news and market trends.
Crypto stocks to consider in 2024
Keep in mind that this article doesn't provide any investment advice or recommendations. Investors interested in buying stocks of companies related to the crypto industry should decide based on an evaluation of their financial situation, needs, investment goals, and risk tolerance. Cryptocurrency investing or any other type of investing comes along with loss-related risks.
We have prepared a list of the most popular crypto stocks traded on U.S. exchanges. Let's take a look.
Coinbase Global Inc
Coinbase is known for being one of the largest crypto exchanges worldwide. The company Coinbase Global Inc. became a publicly traded company in 2021 as its shares have been directly listed on the NASDAQ stock exchange.
Coinbase provides users with a wide array of services and a marketplace for crypto transactions. The company founded back in 2012 has a market cap of approximately $62 billion.
As a cryptocurrency exchange, Coinbase’s performance is directly correlated with crypto prices, and its revenue is impacted by trading volumes and the overall dynamics of crypto markets.
Marathon Digital Holdings Inc
Marathon Digital Holding Inc., formerly known as Marathon Patent Group Inc., was founded in 2010. The company in question is related to the digital asset technology sector by mainly focusing on Bitcoin mining.
The company’s operations include processing Bitcoin transactions, maintaining the blockchain’s security, and generating newly minted coins. It claims to be one of the largest and most energy-efficient Bitcoin mining operations in the world.
The company’s performance is closely connected to the crypto market, specifically the price of Bitcoin due to the profitability of mining being tied to the market value of the minted coin. Back in 2023, Marathon held a total of 11,466 Bitcoins worth approximately $326 million.
NVIDIA Corporation
NVIDIA became a publicly traded company back in 1999; the company started as a producer of graphics cards used for computer gaming, but recently it expanded into cryptocurrency mining.
The company has been on the market for a long time, and in 2023 it experienced significant growth with its revenue reaching approximately $60 billion.
NVIDIA produces graphics processing units (GPUs) that are used in crypto mining activities. The demand for GPUs for mining has been influenced by the dynamics of the crypto market and created a link between NVIDIA’s performance and the status of the cryptocurrency market.
Block Inc.
The Block Inc. company, formerly known as Square Inc. became a publicly traded company in 2015. It is a digital and mobile payment platform for consumers and merchants and the parent company of Cash App.
At the beginning of 2024, the company had a market cap of approximately $51 billion. Its financial performance is tied to the integration of financial products and commerce.
As for the crypto space, Block is tied to the crypto market through the Cash App platform that provides users with the ability to buy and sell Bitcoin. The company made a strategic investment in Bitcoin by placing approximately 1% of its total assets into it.
Tesla Inc.
Tesla Inc went public in 2010 by offering stocks on the NASDAQ exchange. The famous automotive company reported a revenue of approximately $96 billion in 2023, with a market cap of approximately $559 billion.
Tesla invested in Bitcoin and even accepted it as a payment method for its products in the past. These moves show a close link between Tesla’s financial operations and the cryptocurrency market despite the company not operating within the crypto and blockchain sector.
PayPal Holdings Inc.
The big technology platform that facilitates digital and mobile payments for consumers and businesses stepped into the crypto sphere. PayPal enabled users to buy, sell and transfer cryptocurrencies such as Bitcoin, Ethereum, Bitcoin Cash and Litecoin.
Similar to other stocks from the tech sector, PayPal took a hit in 2022. However, its current market cap equals approximately $69 billion.