If you hate crypto but love blockchain here are three stocks

In today’s Exponential Investor…

  • Lambs, Korean beef and balloons
  • Bitcoin and wine
  • Three non-crypto crypto stocks

Last weekend Mrs. Volkering and I took the child to a local food and drink festival.

It was just in a village nearby us with kids entertainment, some market stalls, music, food and the all-important alcoholic drink.

All very Covid-19 friendly. Ticketed event, orderly entrance with sanitisers, barriers to ensure appropriate distancing, signs to help people queue up and all get along in a safe, outdoor environment.

It was great, a nice reminder of how people can actually co-exist in a space and remember that things will get back to normal much faster than many probably realise.

What’s interesting is that it wasn’t all that different from the last food and drink festival I went to. Maybe less people, but it’s not like everyone sits on each other’s heads or anything… because no one ever used to…

Anyway, the child loved it, or at least he loved the petting zoo and the balloons from one of the market stands.

As for yours truly, aside from an outstanding Korean beef flatbread and pint of Amstel, I had a good natter and tasting with the owners of a local vineyard. Believe it or not, bitcoin ended up on the menu…

We’re right at the start of the chart

After I’d worked my way through the colour chart of wine, I bought a couple of bottles of their red and a bottle of their sparkling.

Being the Covid-19-friendly world we live in, the lovely winemaker asked if I’d be paying cash or card. I half joked, “Who pays cash any more, doesn’t it kill you now?”

One of the guys there we were chatting to (I’m not 100% sure he even worked for the winery now I think about it) remarked that he always pays cash. Never pays card. Doesn’t trust it.

Why? He could be tracked and traced by it, that’s why. He proceeded to tell a story about being somewhere 20 years ago and was effectively lost, but the police told him exactly where he was because of his phone.

He also didn’t carry a phone any more. What he said was/is true. If anyone wanted to find you, the easiest way to do it would be to check your card payment transactions. That’s the first thing authorities look for, when trying to find someone, financial transactions.

At this point I suggested to the slightly paranoid, but friendly fellow that he should consider paying for stuff with bitcoin instead. Not surprisingly this elicited little reaction from either.

However, bitcoin would actually be perfect for this gentleman’s distrust of the financial system. And to be fair, had bitcoin been a payment option on the spot for my wine, then I’d likely have considered it as well.

The thing is that I wasn’t expecting much of a response from these two as there’s still billions of people who know nothing about bitcoin or cryptocurrency. If you were to follow the technology adoption cycle for crypto, we’re still in the “innovators” stage.

Source: Creative Commons

What this means is at such an early stage of this world-changing technology there are those who understand it and are part of the innovators stage – people like you and me. But there are so many more to come into crypto to learn about it, use it, and discover the power of what it can do.

There will, of course, also be many sceptics and detractors along the way. There have been in the entire decade I’ve been involved in crypto. Many of them love to marvel about the underlying technology but lambast the crypto side of things.

In fact, one of the most popular (and frustrating) comments you hear is, “I really like blockchain technology, but hate crypto.”

There are many facets as to why this shows a lack of understanding of the networks being built out. But something for another day.

What I accept and appreciate in the work I do is that not all assets, investments and ideas are for everyone. And there are plenty of people out there that “like blockchain” but “hate crypto”.

There are some who want exposure to bitcoin, to crypto, to blockchain technology, but don’t want to actually own cryptocurrencies. They don’t want the perceived hassle of managing it all. Or they just don’t trust it.

Maybe that’s you? I don’t know.

But I tell you what, I’m very interested to find out if you are or aren’t. In fact, why don’t you tell me? Click on one of the buttons below, just a simple YES or NO in answer to this simple question…

Question: Do you trust cryptocurrency?

YES
NO

  

Well there are a number of ways to play the crypto market without actually getting crypto. It comes mainly via publicly listed companies either directly getting into crypto themselves or those developing blockchain technology systems and applications for it. Now, I’ll collate and let you know the answers to this next week. Let’s say you just clicked “NO” but you still want some exposure to some juicy crypto returns. What do you do?

Three crypto companies to consider

For example, on the London Stock Exchange is a company called Argo Blockchain (LSE:ARB). It is a bitcoin mining company. It operates large bitcoin mining facilities. And it mines a whole lot of bitcoin. Its stock price is very closely linked to how bitcoin performs, as you would expect.

If bitcoin’s fiat-converted price flies, typically so does Argo’s. It makes sense, based on its margins, that if bitcoin’s price is high, it makes more profit per bitcoin it mines.

There are others like Argo on exchanges all over the world. RIOT Blockchain (NASDAQ:RIOT) is also a bitcoin and cryptocurrency miner, but it also invests in blockchain businesses as well.

These are just two examples. The rumours also are that crypto exchange Coinbase may be doing a “traditional” IPO this year with a multi-billion-dollar valuation. That too would be pure exposure to crypto without owning actual crypto.

But perhaps the most interesting way to look at it, is something that happened just yesterday in the public markets.

Yesterday, MicroStrategy Incorporated (NASDAQ:MSTR) announced it had bought 21,454 bitcoin with a fiat-converted value of US$250 million.

MicroStrategy is a US$1.2 billion business intelligence and analytics company. Here’s what it said about its bitcoin decision:

This investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash. Since its inception over a decade ago, Bitcoin has emerged as a significant addition to the global financial system, with characteristics that are useful to both individuals and institutions. MicroStrategy has recognized Bitcoin as a legitimate investment asset that can be superior to cash and accordingly has made Bitcoin the principal holding in its treasury reserve strategy.

If you need a sign that the crypto markets are only just starting to warm up, that’s as big a sign as you’ll find.

But as I say, you don’t have to necessarily get your own crypto if you don’t trust it, like it, or believe in it.

Yet if you still want exposure to the crypto market, the potential that it contains, these are all great ways to consider entry to crypto without the actual “crypto” part.

Regards,

Sam Volkering
Editor, Exponential Investor

Category: Cryptocurrency

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