5 Best Cryptocurrency Stocks To Buy

These 5 stocks are fundamentally strong and have an interest in cryptocurrencies

Last Updated January 4th 2022
12 Min Read

Cryptocurrencies are known for their extreme volatility. Losses of up to 90% are quite normal in the cryptocurrency market.

It is for this reason that cryptocurrency stocks are becoming increasingly popular. Buying stocks exposes you to the potential upside of cryptocurrencies while minimizing the risks of extreme volatility.  

The best part is that a lot more companies are increasingly taking an interest in cryptocurrencies. To help you make the most of your investments, here are some of the best cryptocurrency stocks to buy today. 

The Best Cryptocurrency Stocks to Buy Now:

 

Microstrategy (MSTR)

Microstrategy is probably the only major corporation with heavy exposure to cryptocurrencies. At the moment, it is the largest corporate holder of Bitcoin globally. By the end of 2021, Microstrategy's Bitcoin portfolio was worth over $7 billion. 

Microstrategy recently announced that it spent $94.2 million to buy Bitcoin during the Bitcoin dip of December and scooped up a total of 1,914 BTC.

Besides the potential to derive value from an increase in Bitcoin's price, Microstrategy is looking to unlock new ways to earn from its Bitcoin holdings. In a recent interview, Microstrategy CEO Michael Saylor stated that there are several ways they can generate an income from their Bitcoin. He stated that one of them involves putting a mortgage against it to create long-term income. The other option would be to lend the Bitcoin to a trusted party and help Microstrategy earn interest. 

Essentially, Microstrategy is set to benefit from an increase in Bitcoin's price action and is also less likely to experience extreme volatility in case of a slide in price. Speaking of being cushioned, Microstrategy is a little more than a Bitcoin buying company, aside from the potential to generate income from its Bitcoin holdings. 

Microstrategy is one of the world's leading enterprise analytics software companies. One of its core products is an all-inclusive platform that delivers insights across devices using highly advanced products such as visualizations & reports. Microstrategy's services also help clients access data through APIs while maintaining high levels of security. Essentially, Microstrategy stands to keep generating value for shareholders, regardless of Bitcoin's price movements. 

That aside, there is a good chance that Bitcoin could rally in 2022, a factor that could significantly boost the value of Microstrategy. Bitcoin is growing in adoption by institutions. The process of institutional adoption started in 2021, and with Bitcoin's price increasingly stable above $47k, more institutions are likely to add Bitcoin to their portfolios.

Besides FOMO, institutions have a rational reason to hold Bitcoin in their portfolio. That's because of the risk of inflation in major economies that has come post-pandemic. 

According to AP, while wages have been on the rise in the US, most people cannot keep up with their bills. The report further stated that hourly wages in the US fell 1.2% in October 2021, compared with October 2020. Inflation was also recently highlighted by Bill Ackman who stated that there was a risk of inflation going past 10%. 

Bitcoin comes across as a viable hedge against inflation with such risks at play. That's because it is scarce and easy to transact. These factors could see the value of this cryptocurrency rally going into 2022, and lift the value of Microstrategy.

Aside from the fundamentals, Microstrategy's technical indicators point to a potential rally going into 2022. Microstrategy is trading at $544.49, a key multi-month support level. If this support holds all through January, then chances are that MSTR could rally all through Q1 of 2022. In such a scenario, $800 and above could be within reach. 

 MSTR/USD 1-week chart

Source: TradingView

For such potential gains and the low risk of cryptocurrency-like corrections, Microstrategy is easily one of the best cryptocurrency stocks to buy in 2022.

Overstock.com (OSTK)

If you want exposure to cryptocurrencies without buying crypto, Overstock.com (OSTK) is one of the best cryptocurrency stocks to buy. Overstock was formed as a retail company but has since fully transitioned into a blockchain company.

The company is so serious about its shift into a blockchain company that back in 2017, it launched a cryptocurrency called tZero (To). tZero is a cryptocurrency and blockchain platform that was launched by Overstock. It was created with the goal being to allow companies to launch cryptocurrencies more transparently and in a regulated environment. 

This is a big deal considering that one of the issues that the cryptocurrency market faces today is scams that have thrived due to the unregulated nature of the market. It gives Overstock's tZero blockchain an edge in the market, one that could help grow the company's intrinsic value in 2022 and beyond.

Overstock is in overdrive too, as it pushes into the blockchain market, and that's a positive indicator for an investor looking for a cryptocurrency stock. In January 2021, Overstock.com announced that it was turning its blockchain venture, Medici Ventures, into a limited company. 

While making this announcement, Overstock.com stated that the new venture capital fund would invest in blockchain technology and digital currency companies. The partnership began on January 1st, 2018, with an initial $45 million commitment from Pelion Ventures Partners (PVP) has sole authority over investment decisions for eight years until profits are returned into Overstock's account before being shared.  

Considering that blockchain technology is on a growth trajectory at the momentum, this venture makes Overstock a pretty good cryptocurrency stock to buy for 2022.

The best part about Overstock.com is that its profits are on a growth trajectory, too. In October, the company announced strong earnings that beat analysts' expectations. At the time, Overstock reported quarterly earnings of $0.54, while analysts were expecting earnings of $0.53.

The company announced that in the 12 months to the reporting date, net revenue per customer increased by 23%. This is an excellent pointer to its potential and a factor that makes it a pretty good cryptocurrency stock to buy in 2022.

Besides the strong focus on blockchain and strong quarterly earnings results, Overstock.com has been going down over the last couple of months. Overstock is currently trading at a yearly support level of $61.32. This makes it a perfect entry point into this stock when looking at it for 2022 and beyond.

OSTK/USD 1-week chart

If Overstock were to bounce off its current support level, the potential upside is huge. The first resistance would be at $110.86, close to 100% gains from its current price. 

Selling volumes are in decline, too, an indicator that the potential for a reversal around the $60 to $61 price level is quite high. This potential easily makes Overstock one of the top 5 cryptocurrency stocks to buy now with the view of 2022 and beyond. 

Tesla (TSLA)

Tesla can't miss on a list of cryptocurrency stocks to buy in 2022, and for a good reason. It is one of the major corporations to accept crypto payments, and it also holds Bitcoin in its balance sheet. 

Tesla also recently announced that it would start accepting Dogecoin to sell some of its merchandise. These are just some of the moves that have made it a perfect cryptocurrency stock to watch in 2022. 

Besides the move to hold Bitcoin and accept Dogecoin, there are a couple of other reasons why Tesla is a perfect cryptocurrency stock to buy today. For starters, there is a growing demand for Tesla vehicles, which is good for its revenue growth and intrinsic value.  

Tesla delivered over a quarter million vehicles in the fourth quarter alone, including 296 thousand Model 3's and Y cars and 11750 X models. This is an incredible feat for Tesla, which proved it can compete with other manufacturers on both luxury EV or mass-market vehicle levels by delivering more units than expected.  

In total, 936,000 cars were made this past 12 months. So, while there will always be challenges ahead, Tesla has a head start in the automobile industry as the New Year starts. 

Tesla is also expected to open new plants in 2022 that were scheduled to open in 2021, but it did not happen. Tesla's new plants in Texas and Berlin will drive up the production of Model Y, and help Tesla maintain its competitive advantage in the EV market, not just in the US but globally. 

Tesla also has the advantage of having a strong-willed leader at the helm. Elon Musk has grown to become not just the wealthiest person in the world but has also pushed Tesla to become one of the most valuable companies ever. His drive is likely to keep pushing Tesla's value all through 2022. 

This is already evident in Tesla's charts. Tesla has been on a growth path since 2020 and has been making higher lows all through 2021. In the last week of 2021, it made a bounce off its latest low of $891.80. This signals to a potential upside all through Q1 of 2022. 

TSLA/USD 1-week chart

With Elon Musk strongly pro-crypto, and most factors around Tesla pointing to a potential rally, this is a perfect cryptocurrency stock to buy. It has the potential for cryptocurrency-like gains while also cushioning investors from the volatility of holding cryptocurrencies directly.

 

Coinbase (COIN)

Coinbase provides financial infrastructure and other technologies to cryptocurrency traders and investors. Coinbase gives retail users access to liquidity pools in cryptocurrencies while also offering institutional services such as custody. 

Coinbase is a good bet for investors who want to participate in the cryptocurrency ecosystem without buying cryptocurrencies. For starters, Coinbase is one of the largest cryptocurrency trading platforms in the US and globally. As more investors take an interest in cryptocurrencies, the Coinbase user base will grow as well.

Besides its strong brand name, Coinbase is also quite innovative. Recently, Coinbase announced that it would allow investors to start earning a passive income off cryptocurrencies. 

Coinbase announced that the new feature allows users to lend DAI. The process works through Compound – a protocol where lenders can pool together funds to collect interest on what is essentially risk-free cash while giving borrowers more choices.  

This is a big deal and is likely to draw in more users towards Coinbase this year, driving up its revenues, and by extension, its stock value. 

Thanks to its institutional services, such as cryptocurrency custody, Coinbase is likely to benefit from the growing institutional uptake of cryptocurrencies. One person who thinks institutional interest in cryptocurrencies, especially Bitcoin, could go up is Matt Maley of Miller Tabak. 

In a recent interview, Maley stated that Institutional investors are known for pushing up their winners and getting rid of the losers towards the end of the year. Since most institutions bought Bitcoin in 2021, when it hit new highs, most were in losses towards the end of the year. Since Bitcoin accounts for a small percentage of their total holdings, they sold and pushed the funds into winning stocks. 

However, Maley believes that going into the New Year, many of these institutional players are likely to start taking Bitcoin more seriously as they seek to diversify their portfolios at the beginning of the year. This is a huge opportunity for Coinbase and could help drive its value through 2022. 

Coinbase also looks set to benefit immensely from its entry into the Metaverse space. Through the Coinbase blog, the company recently announced that it is on a mission to help people establish their identity in the Metaverse. Coinbase added that it was working with ENS to help make it possible for users to create an NFT that can be sent to a personal wallet - giving users access across different Metaverse worlds with ease. 

Considering that the Metaverse is projected to be one of the key growth areas of blockchain this year, Coinbase could record significant value growth by tapping into this market. 

From a look at the technicals, Coinbase makes a lot of sense as a cryptocurrency stock to buy now. Coinbase has started the New Year trading at a key support level around the $251 - $252 price range.

COIN/USD 1-week chart

If this support holds for the next few weeks, there could be a high possibility of Coinbase bouncing off it. In such a scenario, the first major resistance would be at $280. This makes its current price a perfect entry point if you want to buy a high-potential cryptocurrency stock for 2022. 

Block (SQ)

Block, formally known as Square, is Jack Dorsey's brainchild, who until recently was both the CEO of Twitter and Square. He stepped down as the CEO of Twitter to focus his energies on running Square. This is a big deal if you want a good cryptocurrency stock for 2022. That's because Dorsey is very much pro-crypto and, through Square, has invested in Bitcoin and other blockchain-related technologies. 

Jack Dorsey also has his eyes firmly set to Web 3.0, the next evolution of the web, driven by blockchain technology. He has in-depth knowledge of Web 3.0 and even got into an argument with some VC heavyweights advocating for centralized control of what is ideally a decentralized version of the web. 

Besides having a pro-crypto person at the helm, there are a couple of other reasons why Square makes sense as a cryptocurrency stock investment. One of them is that Square is on an expansion path, which means it can grow revenues, and by extension, its stock value.

In August, Square announced that it was buying AfterPay, a 'buy now pay later' company, for $29 billion. Through the purchase, Square aims to make it easier than ever for small businesses and retailers of all sizes to offer payment plans with AfterPay. With this integration, customers will handle all their payments right in Cash App. 

It's a strategic acquisition that will likely boost Square's value, not just in 2022 but also for many years to come.

Block also makes sense as a cryptocurrency stock to buy now when considering its technical indicators. 

Block has started the New Year trading at a key support level ($157 – $160) and after a heavy selloff for the better part of Q4 of 2021. With the purchase of AfterPay, and the crypto market turning a corner after a sluggish Q4, Block has a good chance of bouncing off its current support levels. 

SQ/USD 1-week chart

Essentially, based on a confluence of technical and fundamental indicators, Block makes sense as a cryptocurrency stock to buy now. 

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