In this article, we discuss the 11 best crypto stocks to buy now.
2021 was a topsy-turvy one for the crypto industry as Bitcoin, the most popular digital coin in the world, registered multiple all-time highs and major interest from institutional investors as a hedge against inflation. However, the coin also witnessed record lows amid a broader lull around the industry during the summer. Dave Abner, a senior executive at Gemini, a leading cryptocurrency exchange, has labeled the year a “breakthrough” one for blockchain technology as the US government considers regulating the sector to mainstream it further.
2021 Crypto Roundup and Future Trends
Bitcoin crossed $1 trillion in market capitalization last year and investors have started the coin with increased interest since the price of Bitcoin is not directly related to that of other big asset classes. EL Salvador became the first country in the world to adopt the coin as legal tender in 2021, paving the way for other nations to follow suit. Ethereum, the second most popular coin, was also in the headlines in 2021 as it transitioned to a “proof-of-stake” system to improve efficiency and become less energy intensive with regards to mining.
According to Blockdata, a market intelligence platform focusing on crypto, investors poured more than $23 billion into crypto startups in 2021. This was more than the total crypto startup funding for the previous three years combined. Moving forward into 2022, crypto regulation in financial capitals like New York and London, crypto exchange-traded funds, and the broader institutional adoption of the new technology are major trends expected to shape the industry.
Investors eager to capitalize on these growth catalysts should consider some of the top crypto stocks to buy now that include Mastercard Incorporated (NYSE:MA), PayPal Holdings, Inc. (NASDAQ:PYPL), and Block, Inc. (NYSE:SQ), among others discussed in detail below.
Our Methodology
The companies that operate in the crypto sector were selected for the list through a careful assessment of business fundamentals and analyst ratings to provide readers with some context for their investment choices.
Hedge fund sentiment was included as a classifier as well. The hedge fund sentiment around each stock was calculated using the data of 867 hedge funds tracked by Insider Monkey.
Photo by André François McKenzie on Unsplash
Best Crypto Stocks To Buy Now
11. BIT Mining Limited (NYSE:BTCM)
Number of Hedge Fund Holders: 6
BIT Mining Limited (NYSE:BTCM) has shed non-crypto assets and is trying to make a name for itself in the crypto world in the difficult Chinese market. BIT Mining Limited (NYSE:BTCM) owns more than two thousand Bitcoin and Ethereum combined. It also holds over 61 million Dogecoin. The firm hopes to produce digital coins worth tens of million per month this year. For this purpose, BIT Mining Limited (NYSE:BTCM) has increased a stake in an Ohio-based crypto mining site and bought Bitcoin mining machines worth more than $6 million.
BIT Mining Limited (NYSE:BTCM) has shielded itself from a crackdown against crypto in the Chinese market by moving operations overseas. The company has business interests in Texas and Kazakhstan as well. 6 hedge funds in the database of Insider Monkey hold stakes worth $32 million in BIT Mining Limited (NYSE:BTCM).
Just like Mastercard Incorporated (NYSE:MA), PayPal Holdings, Inc. (NASDAQ:PYPL), and Block, Inc. (NYSE:SQ), BIT Mining Limited (NYSE:BTCM) is one of the stocks on the radar of growth investors.
10. Canaan Inc. (NASDAQ:CAN)
Number of Hedge Fund Holders: 8
Canaan Inc. (NASDAQ:CAN) is one of the few companies that market Bitcoin mining machines. On December 15, Canaan Inc. (NASDAQ:CAN) announced that it had received a follow-up order from Genesis Digital Assets Limited for 30,000 Avalon Bitcoin mining machines. The original contract had provided the latter with 20,000 machines with an option to buy a further 180,000. Canaan Inc. (NASDAQ:CAN) will deliver the machines in the first quarter of 2022.
In addition to rising coin mining machine sales, Canaan Inc. (NASDAQ:CAN) has also stepped up investments in mining itself. On January 4, Canaan Inc. (NASDAQ:CAN) stock jumped over 4% after the firm announced that it had entered into deals with multiple firms in Kazakhstan for the joint mining business, starting with deployment of 10,000 machines for the purpose.
9. Bit Digital, Inc. (NASDAQ:BTBT)
Number of Hedge Fund Holders: 4
Bit Digital, Inc. (NASDAQ:BTBT) is one of the largest Bitcoin miners in the world but the company has taken a beating in the recent Chinese crackdown against the new tech. However, Bit Digital, Inc. (NASDAQ:BTBT) has moved mining operations out of China entirely and used the time to reinvent itself. For example, the company has opted to move operations to the stable North American market, selected renewables as a significant portion of the energy mix to attract new investment, and is steadily building up an already substantial treasury of digital coins.
Hedge funds also seem bullish on Bit Digital, Inc. (NASDAQ:BTBT) stock. New Jersey-based investment firm Sabby Capital is a leading shareholder in Bit Digital, Inc. (NASDAQ:BTBT) with 4.2 million shares worth more than $30 million.
8. Bitfarms Ltd. (NASDAQ:BITF)
Number of Hedge Fund Holders: 5
Bitfarms Ltd. (NASDAQ:BITF) is another relatively new player in the Bitcoin mining market. The company debuted on the market in June 2021. On January 3, the stock jumped over 3% after Bitfarms Ltd. (NASDAQ:BITF) announced that it had mined 363 Bitcoin in December, representing a 228% growth in hashrate and taking the total number of Bitcoin mined in 2021 to 3,452. The total value of these coins is more than $151 million.
The company recently bought 1000 bitcoins, taking advantage of the recent slump in crypto prices. The company bought the coins for $43.2 million.
Bitfarms Ltd. (NASDAQ:BITF) plans to double operations farms, triple operational capacity, and increase the annual hash rate by 400% in 2022. Four new mining farms in this regard are already under development. Emiliano Grodzkim, the CEO of Bitfarms Ltd. (NASDAQ:BITF), has said that the firm secured 60,000 generation miners and achieved growth plans in 2021.
7. Marathon Digital Holdings, Inc. (NASDAQ:MARA)
Number of Hedge Fund Holders: 12
DA Davidson analyst Christopher Brendler recently maintained a Buy rating on Marathon Digital Holdings, Inc. (NASDAQ:MARA) stock with a price target of $65, identifying the firm as the “Top Pick” among cryptocurrency miners for 2022 in a bullish investor note. The analyst highlighted huge wins for Marathon Digital Holdings, Inc. (NASDAQ:MARA) in 2021 that included a new rig order from industry leader Bitmain.
Hedge funds also favor Marathon Digital Holdings, Inc. (NASDAQ:MARA) as a crypto mining play. 12 hedge funds in the database of Insider Monkey were long Marathon Digital Holdings, Inc. (NASDAQ:MARA) at the end of September with stakes worth $46 million.
6. Coinbase Global, Inc. (NASDAQ:COIN)
Number of Hedge Fund Holders: 50
Bank of America analyst Jason Kupferberg recently upgraded Coinbase Global, Inc. (NASDAQ:COIN) stock to Buy from Neutral with a price target of $340. The analyst, in a bullish investor note, cited revenue diversification trends for Coinbase Global, Inc. (NASDAQ:COIN) away from retail crypto trading as one of the reasons behind the upgrade. The analyst backed NFTs, DeFi, and other products to drive the firm forward in 2022.
Coinbase Global, Inc. (NASDAQ:COIN) is the largest crypto exchange in the world in terms of value of trades on the platform and as digital coins become more mainstream, it will be one of the biggest beneficiaries of the boom. Hedge funds favor the company as well. 50 hedge funds in the database of Insider Monkey hold stakes worth $2.9 billion in Coinbase Global, Inc. (NASDAQ:COIN).
In addition to Mastercard Incorporated (NYSE:MA), PayPal Holdings, Inc. (NASDAQ:PYPL), and Block, Inc. (NYSE:SQ), Coinbase Global, Inc. (NASDAQ:COIN) is one of the stocks that hedge funds are buying.
In its Q3 2021 investor letter, Hayden Capital, an asset management firm, highlighted a few stocks and Coinbase Global, Inc. (NASDAQ:COIN) was one of them. Here is what the fund said:
“Coinbase (COIN): We established a new position in Coinbase, the dominant US crypto exchange and brokerage, this quarter. Given the misperceptions and early-stage nature of the industry, I thought it would be helpful for our partners’ understanding to share a report outlining our thesis, which we published on October 31st.
At a high level, we believe the crypto economy is in the middle of “crossing the chasm” into mainstream adoption & use cases, which will result in millions of mainstream users needing to transact in crypto in some form.
Coinbase is well positioned in the Western, regulated markets to capture this influx – considering their dominant market share / mindshare, their focus on the casual user and thus superior userexperience compared to alternatives, and their position as a “toll-booth” for this industry. Longer-term, we also believe Coinbase has “super-app” ambitions, and will be the primary gateway for both the general population and institutions to interact with the crypto economy…” (Click here to see the full text)
5. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 65
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a semiconductor firm. The products marketed by it are used to power machines that mine cryptocurrencies. Wedbush analyst Matt Bryson has an Outperform rating on Advanced Micro Devices, Inc. (NASDAQ:AMD) stock with a price target of $165. In an investor note, the analyst highlighted that Advanced Micro Devices, Inc. (NASDAQ:AMD) would gain market share in the intermediate term provided it executed growth plans over the next few years.
Major hedge funds recognize Advanced Micro Devices, Inc. (NASDAQ:AMD) as a top chipmaker. Chicago-based investment firm Citadel Investment Group is a leading shareholder in Advanced Micro Devices, Inc. (NASDAQ:AMD) with 12 million shares worth more than $1.3 billion.
In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Advanced Micro Devices, Inc. (NASDAQ:AMD) was one of them. Here is what the fund said:
“We also exited our positions in Advanced Micro Devices. Our investment campaign in Advanced Micro Devices (AMD) began in the second half of 2018, and we have seen a new management team reinvigorate the company’s product portfolio of microprocessors for PCs and servers, graphics processors, and video game consoles. These new, higher-margin products have helped the company partially close its margin gap with peers and capture share from market leader Intel. While we believe there is meaningful runway for further share gains and margin expansion, AMD has appreciated far beyond our mid-cap market cap mandate, and we exited our position.”
4. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 83
NVIDIA Corporation (NASDAQ:NVDA) is another chip stock that is very important for the crypto industry. In the past year, due to a shortage of chips amid increased demand, Bitcoin miners have turned to NVIDIA products, held in high regard by the gaming industry, to power their machines. The results have been more than satisfactory and the use of NVIDIA chips in mining is becoming more common. NVIDIA Corporation (NASDAQ:NVDA) has even introduced a dedicated GPU product aimed at professional miners.
Bank of America analyst Vivek Arya has a Buy rating on NVIDIA Corporation (NASDAQ:NVDA) stock with a price target of $375. The analyst has identified NVIDIA Corporation (NASDAQ:NVDA) as a “Top Compute Pick” for 2022.
In its Q1 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and NVIDIA Corporation (NASDAQ:NVDA) was one of them. Here is what the fund said:
“NVIDIA Corp. is the dominant supplier of Graphics Processing Units (GPUs) worldwide. NVIDIA’s GPUs are at the intersection of a number of important computing trends including the movement to the Cloud, artificial intelligence, autonomous vehicles, edge computing, gaming, and more. We previously owned NVIDIA and sold it in the third quarter of 2020 as the price to value gap closed and our margin of safety was reduced. As with all our MVP companies, we continued to follow NVIDIA closely. Since that time, NVIDIA reported excellent results and its value has compounded rapidly. The technology selloff at the beginning of the year negatively affected the stock price while our estimate of NVIDIA’s value per share increased. This happy combination of events created a margin of safety and an opportunity to once again add NVIDIA to the portfolio.”
3. Block, Inc. (NYSE:SQ)
Number of Hedge Fund Holders: 98
98 hedge funds in the database of Insider Monkey were long Block, Inc. (NYSE:SQ) at the end of the third quarter of 2021 with stakes worth $8.8 billion. The overwhelming confidence that the hedge fund industry displays in Block, Inc. (NYSE:SQ) speaks volumes about the reliability of the company. Block, Inc. (NYSE:SQ) is a payments technology firm with hundreds of millions invested in crypto assets.
Susquehanna analyst James Friedman has a Positive rating on Block, Inc. (NYSE:SQ) stock with a price target of $275. Mizuho and Jefferies are also bullish on the stock for 2022 despite market fears around inflation and their effect on growth stocks.
In its Q1 2021 investor letter, RiverPark Funds, an asset management firm, highlighted a few stocks and Block, Inc. (NYSE:SQ) was one of them. Here is what the fund said:
“We established a position in leading Financial Technology provider Square during the quarter. Through one integrated system, SQ is a hybrid of two businesses: its Seller Business (charging small and medium-sized businesses about 3% for transaction payment processing, plus other services such as instant funds access, and software for everything from customer engagement to payroll), and its Cash App (originally for person-to-person cash transfers and now a growing digital financial services provider for consumers).
The combined business has grown gross profit at a 37% CAGR over the past five years to $2.7 billion (due to pass through costs, gross profit is more reflective of top-line growth) and we believe that the company has an enormous long-term runway, as it has less than a 2% share of a more than $160 billion market. It is our view that the company’s Cash App (which has grown
from nothing in 2015 to $1.2 billion gross profit last year) has a particularly large opportunity with its powerful ecosystem of digital financial services including digital wallets, direct deposits, stock trading, bitcoin trading, and business and tax services, which are all relatively new. The vast majority of Cash App’s more than 36 million users are younger and, importantly, are willing to replace their bank and other financial services accounts with the app.
We estimate that the company can grow its gross profit more than 30% and EBITDA more than 50% annually for the foreseeable future, and while most of the company’s current profit is from its Seller Business, we believe most of Square’s future value will be from its Cash App business.”
2. PayPal Holdings, Inc. (NASDAQ:PYPL)
Number of Hedge Fund Holders: 123
PayPal Holdings, Inc. (NASDAQ:PYPL), one of the biggest cross-border payment firms in the world, increased crypto exposure significantly last year. The company allowed the trade of crypto on its platform through a special cryptocurrency service and also made several investments in crypto-focused startups. Evercore ISI has named PayPal Holdings, Inc. (NASDAQ:PYPL) stock among the top picks in the payments sector for 2022.
At the end of the third quarter of 2021, 123 hedge funds in the database of Insider Monkey held stakes worth $12.8 billion in PayPal Holdings, Inc. (NASDAQ:PYPL), compared to 143 in the preceding quarter worth $16.4 billion.
In its Q4 2020 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ:PYPL) was one of them. Here is what the fund said:
“For the full year 2020, one of the top performers was PayPal, which we purchased in 2019, the company continues to take market share in digital payments and has seen an acceleration in user adoption and engagement, especially within their “silver tech” or older user demographic. We expect many more years of ongoing double-digit growth from their various business segments and new initiatives.”
1. Mastercard Incorporated (NYSE:MA)
Number of Hedge Fund Holders: 146
Mizuho analyst Dan Dolev has a Buy rating on Mastercard Incorporated (NYSE: MA) stock with a price target of $400. The analyst believes that Mastercard Incorporated (NYSE:MA) will perform better than peers in the payments sector in 2022 because of “more agility in terms of trends like crypto” and “out-of-the-box thinking” that was driving margin upsides. Mastercard Incorporated (NYSE:MA) already allows users to use digital coins Mastercard products.
Hedge funds are bullish on Mastercard Incorporated (NYSE:MA) for 2022. Virginia-based investment firm Akre Capital Management is a leading shareholder in Mastercard Incorporated (NYSE:MA) with 5.8 million shares worth more than $2 billion.
In its Q4 2020 investor letter, Bretton Fund, an asset management firm, highlighted a few stocks and Mastercard Incorporated (NYSE:MA) was one of them. Here is what the fund said:
“While consumers resumed much of their spending by summer, what and how they used their Visas and Mastercards changed. For obvious reasons, people shifted to contactless payments—one of the Covid-era changes we think is permanent—and replaced travel purchases with online shopping and food delivery. Consumers spent more on their debit cards and less on their credit cards; Visa and Mastercard make more per transaction on the latter. They also make more on cross-border transactions that come mostly from international travel, which ground to a halt early in the pandemic. Visa’s and Mastercard’s earnings per share fell by 7% and 16%, respectively, compared to their usual mid-teens growth. We’re not too worried, and we think they’ll catch up nicely in the post-vaccine world. Visa’s stock returned 17.1% and Mastercard’s 20.2%.”
You can also take a peek at 10 Best Healthcare Dividend Stocks to Buy Now and 10 Dividend Stocks with Over 20 Years of Dividend Increases.
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Disclosure. None. 11 Best Crypto Stocks To Buy Now is originally published on Insider Monkey.
