The buzz around bitcoin is deafening. There is so much noise out there about people begging to short it, those saying that it is going to $50,000 or even $500,000. So much talk and so much to learn.
I am going to go on the record as a believer in the idea of cryptocurrency and that it is only a matter of time before there is worldwide adoption. Central banks have controlled currencies for the past several decades and we have seen far too many instances of runaway inflation destroying currency. Those days are coming to an end.
Over the weekend I finally dipped my toe into the cryptocurrency market and I wrote all about it in my FREE Tech Stock Newsletter. You can sign up for that FREE newsletter here.
One more shameless self-promotion before I get to the stocks that investors can look at to participate in the Bitcoin Boom. If you haven't opened an account with Coinbase, then use this link: https://www.coinbase.com/join/5289987bc1d5d79097000273 and you and I will both get $10 of free Bitcoin.
In the near term, there will be a multitude of ETF's coming to the market that will boast to have significant exposure to bitcoin and other cryptocurrencies. They will also have a significant amount of exposure in stocks that are in the same space.
The idea is that some stocks are already on the short list of ETF managers
One stock that has already announced that they are helping people get exposure to bitcoin and other crypto's is Square (SQ - Free Report) . The stock is a Zacks Rank #3 (Hold) but has the divergence that I love to see. The divergence I am speaking of is an F Value style score and an A for Growth. Growth investors and value investors are inherently looking for different things so when I see that I know that I am on the right path.
Overstock (OSTK - Free Report) was among the first stocks that started accepting Bitcoin and that has driven a lot of early performance. It is also a Zacks Rank #3 (Hold) but the style scores are not as good. I have seen that this stock has become a favorite of the shorts, with 67% of the float sold short. That is absurdly high and the potential for a short squeeze is so high that it might be worth a stab.
Imagine hearing on the next OSTK earnings conference call that they have collect 1,000 bitcoins a day... which will also legitimize the currency but will also add an element to the story the shorts likely don't see coming.
Zacks Rank Missing
I wanted to throw out two other ideas here. One is Riot Blockchain and the other it MGT Investment - the later of which I own. Both of these plays are interesting in their own right, but without research coverage, there is no Zacks Rank.
One last idea I have is based on the idea of Blockchain... or the ledger of recording all the transactions of bitcoin exchanges. This technology has been called a game changer and I have done very little in terms of research on how to benefit from it. The thing I do know is that it requires thousands of very powerful computers and those computers need powerful chips. Nvidia NVDA is clearly the leader in that space, so that is my blockchain play.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
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