Blockchain is one of the most promising technologies of modern times. While the concept of distributed ledgers (DLT) has been around for a long time, its first implementation was done by a developer (a group of developers) called Satoshi Nakamoto in a new cryptocurrency called Bitcoin. In the last decade, blockchain has grown from being a geek’s fantasy to be a technology that makes tech giants and governments around the world, curious about the concept of decentralization.
DLT is still a nascent sector but one that promises immense potential. For investors, blockchain is a relatively stable investment option as compared to their more volatile implication cryptocurrencies. If you are interested in exploring this sector, check out our top 5 blockchain stocks to buy in July.
MasterCard is the most prominent payments firm in the world and is uniquely positioned to make a big impact in the world of blockchain and cryptocurrencies. Most recently, the company announced its plans to launch crypto-linked cards in partnership with CoinBene. These cards will be available alongside a digital wallet and target Brazilian and Chinese populations.
The company also has serious developments in blockchain. It holds multiple patents for blockchain, one of which was granted in October last year to partition a blockchain to support multiple transaction types. The company holds an innovative edge in developing DLT as it a member of the Enterprise Ethereum Alliance (EEA) and Digital Currency Group, which works as an incubator and collaborator for blockchain-related startups. Overall, if you are looking at a solid blockchain stock, MasterCard should be it.
Overstock.com Inc. (NASDAQ:OSTK)
The eCommerce retailer is among the most outspoken Bitcoin supporters in the corporate world and accepts cryptocurrency on its platform. It also has a blockchain-focused subsidiary called tZero that recently hired a head of communications, ahead of investor relations and ahead of the issuance.
The company is so excited with its cryptocurrency results that it may even think of saying goodbye to its retail business. It plans to make a bold transformation from a retail company to a fully-fledged blockchain company, just like Riot Blockchain which was earlier a biotech firm.
IBM Common Stock (NYSE:IBM)
For anyone looking for a dependable tech giant that is leading blockchain development from the front, IBM is the obvious choice. The company will give you exposure in the best of the latest technology from blockchain to artificial intelligence. It is involved in more than 500 projects related to blockchains. Not only this, it has an advanced blockchain-as-a-service (BaaS) offering as well. It supports a trade finance platform called “we.trade” and payment service “CLSNet.”
The company is collaborating with other interested business and entities in DLT left, right and center. It’s IBM Food Trust initiative with Walmart is one of its most ambitious projects ever that bring food safety to consumers by managing the supply-side of Walmart’s business on the blockchain. Most recently, the New York Times announced that it would use IBM’s blockchain tech to combat fake news. The proof-of-concept (POC) for this project will be designed with the help of IBM Garage and Hyperledger Fabric, a permissioned private blockchain network.
Advanced Micro Devices (NASDAQ:AMD)
AMD is a GPU manufacturer that benefitted because of the blockchain and cryptocurrency revolution. AMD produces high-powered GPUs that can be used by cryptocurrency miners. These chips improve and enhance the computing power of their mining devices and help them solve complex mathematical puzzles to create a block and unlock block rewards. When the prices of digital currency started jumping and leaps and bounds in 2017, AMD was one of the largest beneficiaries of the trend.
Currently, Bitcoin is trading around the $10,000 mark, which shows significant profit margin for crypto miners. If the prices don’t fall below $4,000, Bitcoin mining will continue being profitable for these miners. This means that the demand for more advanced and high processing power chips will also continue rising. Recently, a new type of bitcoin scam has emerged in the form of bitcoin trading bots like bitcoin revolution, which promises investors a high return on their investment.
But it’s not just cryptocurrencies that AMD is involved in. It announced the joint development of a blockchain-based cloud computing system with Enterprise Ethereum Company in January this year. This gives AMD an edge over its competitors, who are either involved only in crypto or in the blockchain.
NVIDIA Corporation (NASDAQ:NVDA)
In the hay day of crypto price rise, NVIDIA GPU chips were becoming so hard to obtain that they were selling for 3x their market price. These chips, just like those produced by its rival company AMD, are used in cryptocurrency mining.
The market demand for the chips by miners was so strong that the company had to come up with a statement to sell them at the market place and prefer their primary customer base, i.e. gamers. However, Bitcoin mining isn’t a one-time frenzy, and miners constantly need chips to improve their computing power. In this regard, NVIDIA can look into a future where its earnings are driven by cryptocurrency mining activities.
This year, crypto bulls have shown a strong resurgence in the market, which could be helpful for the company to sell off its GPU stock and make way for new growth in the market. Even as a semiconductor stock, NVIDIA makes a good buy for your portfolio but with the added advantage of crypto and blockchains, it becomes a lucrative opportunity to cash in on the best upcoming technologies in the world.
Before investing in a blockchain stock, it would be vital to understand what a blockchain is and how it works. it would be important to keep yourself away from the hype. Just like the 90s and its dot-com revolution, blockchain is a hot technology space that will give rise to several successes and failures. By investing in established companies that have a proven track record, investor confidence, and a working product, you will be able to avoid unpleasant shocks to your portfolio. As soon as you are ready to invest, check out one (or all) of the stocks we mentioned above, and find the perfect fit for your portfolio.