In this article we will take a look at the 10 best crypto, bitcoin stocks to buy instead of overvalued Coinbase. You can skip our comprehensive analysis of the crypto industry and go directly to the 5 Best Crypto, Bitcoin Stocks to Buy Instead of Overvalued Coinbase.
San Francisco-based cryptocurrency exchange platform Coinbase Global, Inc. (NASDAQ: COIN) went public on April 15 with a market capitalization of $86 billion. Coinbase CEO Brian Armstrong became one of the richest men in the world after the listing, with some 40 million shares he owns in the firm equating to almost $16 billion in value. The company was founded by Armstrong in 2012 and is one of the largest crypto exchange platforms globally and facilitates the buying, selling, and storage of digital currencies, including giants like bitcoin and ethereum.
What's So Special About Coinbase IPO?
The platform has more than 56 million users internationally out of which more than 6 million use the exchange every month. On the back of increasing trade, the firm generated more than $1 billion in annual revenue last year, up more than 135% compared to the preceding year as the pandemic boosted cryptocurrency-linked platforms. It has so far hosted transactions worth more than $335 billion from more than a hundred countries.
News media has described the public listing of Coinbase as a watershed moment for the crypto industry that will usher in the crypto gold rush and make the new technology mainstream. However, there is reason to exercise extreme caution as reckless finance advisors bully investors into betting on crypto. There are several reasons for this. Coinbase was valued at over $85 billion when it listed, a capitalization that stock experts believe is overvalued. Peter Cohan, an American businessmen and financial expert, has termed the firm not worth the price.
The numbers would seem to back this opinion. Coinbase, on the day it went public, was valued near the market cap of investment bank HSBC Holdings plc (NYSE: HSBC) and larger than other traditional names in the banking industry like UBS Group AG (NYSE: UBS) and Banco Santander, S.A. (NYSE: SAN). These banks have trillions of dollars worth of assets under their care and have years of experience of how to turn them into profits. The higher valuation of Coinbase seems a little confusing in this context.
Is Coinbase Overvalued?
David Trainer, the CEO of investment research firm New Constructs, has compared the valuation of Coinbase to the boom in aviation and auto manufacturing industry over the early part of the second half of the twentieth century, saying that many companies were valued highly at the time but precious few have survived. However, even though Coinbase may be overvalued, there is still reason to be bullish on the crypto industry in general. The momentum that seemed to have favored traditional finance in the battle against fintech is definitely shifting.
The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
With this context in mind, here is our list of 10 best crypto, bitcoin stocks to buy instead of the overvalued Coinbase.
10. Riot Blockchain, Inc. (NASDAQ: RIOT)
Riot Blockchain, Inc. (NASDAQ: RIOT) is a Colorado-based Bitcoin mining company. The firm supports Bitcoin blockchain through the industrial-scale mining of the cryptocurrency. Riot employs more than 7,000 miners for the purpose and is currently based in the United States only. The company is one of the largest publicly traded crypto mining operations in the world and has plans to expand to countries outside the US in the future. It is placed tenth on our list of 10 best crypto, bitcoin stocks to buy instead of the overvalued Coinbase.
It has a market cap of more than $4.2 billion and reported more than $12 million in annual revenue in December 2020, up almost $6 million to the previous year. The 52-week price range of company stock hovers between $5.3-$0.6. Earlier this month, Riot announced that it had acquired Whinstone US, a firm operating colocation data centers for cryptocurrency mining. The share price of Riot stock jumped more than 5.5% earlier in the week after it announced that its March Bitcoin production had risen 80% compared to the previous year.
9. HIVE Blockchain Technologies Ltd. (TSXV: HIVE.V)
HIVE Blockchain Technologies Ltd. (TSXV: HIVE.V) is a Vancouver-based company focused on the use of supercomputing assets and cloud software for the mining of popular cryptocurrencies like Ethereum and Bitcoin. The company says that the operations provide shareholders of the firm an inroad into the margins associated with crypto mining. The share price of the firm is closely linked to Bitcoin and as Bitcoin prices rise, HIVE stock skyrockets as well. It is placed ninth on our list of 10 best crypto, bitcoin stocks to buy instead of the overvalued coinbase.
The company has a market cap of more than $1.2 billion and posted more than $29 million in annual revenue in March 2020, down slightly from $31 million the year before. The 52-week price range of HIVE stock lies between $5.75 and $0.16. Last month, the firm announced that it inked a strategic partnership deal with financial services firm DeFi Technologies for a share swap arrangement. Under the deal, HIVE would receive 10 million DeFi shares for 4 million HIVE shares. The transaction is expected to be complete by the end of this week.
8. Marathon Digital Holdings, Inc. (NASDAQ: MARA)
Marathon Digital Holdings, Inc. (NASDAQ: MARA) is a Las Vegas-based firm that mines cryptocurrencies. It concentrates on the blockchain ecosystem and digital assets The company has plans to expand current operations of more than 2,600 Bitcoin miners to 103,000 miners in the coming years. The proprietary data center of Marathon, located in Hardin MT, has a maximum power capacity of 105 Megawatts. The company is placed eighth on our list of 10 best crypto, bitcoin stocks to buy instead of the overvalued Coinbase.
The firm has a market cap of more than $4.25 billion and posted more than $4 million in annual revenue in December 2020. The 52-week share price of the firm tell a story of every other cryptocurrency firm, a high-risk, high-reward game, as it hovers between $57.7 and $0.3. Last month, the company announced that it had entered into a deal with crypto technology firm DMG Blockchain Solutions to license proprietary Blockseer technology of DMG for crypto miners in North America. Marathon has also launched a North American Bitcoin mining pool.
7. Argo Blockchain plc (LSE: ARB.L)
Argo Blockchain plc (LSE: ARB.L) is a London-based cryptocurrency firm that focuses on large scale mining of digital currencies. The mining operations of the firm are located in locations scattered the United States and Canada. The firm claims that the operations it engages in are more energy-efficient mining - crypto mining consumes a lot of electricity - than those of other firms. These efficiencies translate to better overall margins for the firm in the longer term, something it markets to potential investors across the world.
It has a market cap of more than $1.05 billion and posted close to $6.8 million in revenue for the second quarter of 2020, down slightly from $6.9 reported in the preceding quarter. The 52-week price range of company stock is $4.6-$0.9. In January, the firm reported that it had mined 96 Bitcoin in December 2020, down from 115 Bitcoin mined in the previous month. Peter Wall, the CEO of Argo, said the firm was excited as the crypto market had entered the new year on a roll and more widespread adoption of cryptocurrencies was expected in the year.
6. Canaan Inc. (NASDAQ: CAN)
Canaan Inc. (NASDAQ: CAN) is a China-based technology firm that makes computer hardware like microprocessors. The company specializes in Blockchain servers and microchip solutions for use in bitcoin mining. It is also involved in the assembly, supply chain, and distribution of system products. The firm has stakes in the artificial intelligence and data center business as well. It was founded in 2013 and is placed eight on our list of 10 best crypto, bitcoin stocks to buy instead of the overvalued Coinbase.
It has a market cap of more than $2.1 billion and posted more than $68.5 million in annual revenue in December 2020, down more than $140 million from the previous year as the pandemic hit the sales of the firm. The shares of the firm have been soaring on the back of rising Bitcoin prices. The 52-week price range of company stock lies between $39.1 and $1.7. On April 15, a law firm announced that a group of investors may initiate class action against the firm for alleged securities fraud.
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