Did You Buy These Blockchain & Bitcoin Stocks When They Traded For Pennies?
Penny stocks are obviously a big focus for traders and investors alike. The profound nature of these cheap shares to quickly advance and produce gains in undeniable. This is why so many new traders choose to buy them. The ability to pick up thousands of shares for hundreds of dollars and turn those “hundreds” into “thousands” is what keeps fast-paced traders attentive to stocks under $5. But what about investors?
Are there any penny stocks to invest in? While your definition and my definition of investing may be different, let’s take a few things into consideration. First, we know that stocks like these are high-risk and highly speculative. In this light, not all penny stocks are best suited for investing. However, some traders take up trading styles that allow them to hold a core position while trading in and out.
The end result, hopefully, is a cost basis that remains lower than the current retail price. We’ve discussed tier trading before and this method works for day traders and swing traders alike. What about investors? In this case, I think penny stocks can offer the potential for a hybrid more akin to swing trading than anything. This essentially means a trade that can turn into a longer-term hold or investment.
Now that we’ve set a bit of a basis for trading/investing, let’s get into the focus of this article: bitcoin and blockchain stocks. These have been notorious for making and breaking both traders and investors alike. Back in 2018, we saw cryptocurrencies and crypto stocks crumble within a matter of months. Now, in 2020 and 2021, it’s back in the spotlight in a big way. In fact, Bitcoin prices topped $35,000 this week.
Bitcoin & Blockchain Penny Stocks Have Surged
This week we’ve seen that all-too-familiar hype come in and boost certain penny stocks. A gaming company we discussed recently, The9 Limited (NCTY Stock Report) has gotten folded into the “crypto” discussion. The one standout is a recent filing that states the company entered into a cooperation and investment term sheet with investors involved with Canaan (CAN Stock Report), a Bitcoin mining machine manufacturer.
“The9 has begun to deploy its blockchain and cryptocurrencies business strategy…Our goal is to build up cryptocurrencies mining machines for The9 that will contribute 8% to 10% of the global hash rate of Bitcoin, 10% of the global hash rate of Ethereum and 10% of the global hash rate of Grin and become one of the world’s largest cryptocurrencies mining companies in terms of hash rate,” said Mr. Jun Zhu, Chairman and CEO of The9.
With this tidal wave of momentum has come that “rising tide” which has lifted industry stocks. In this case, some of the cheapest bitcoin penny stocks ended up becoming some of the top ones to invest in last year. Whether or not that remains the case is based on what happens with crypto moving forward. So before you dive right into this wild west industry, do your research and keep risk in mind.
Nevertheless, these 4 former penny stocks have enjoyed a massive rally on the back of the bitcoin boom.
Bitcoin Penny Stocks That Hit It Big
- Grayscale Bitcoin Trust (GBTC Stock Report)
- MoneyGram International Inc. (MGI Stock Report)
- Marathon Patent Group (MARA Stock Report)
- Cleanspark Inc. (CLSK Stock Report)
Bitcoin Stocks To Watch: Grayscale Bitcoin Trust
Grayscale Bitcoin Trust, at this point, doesn’t need much of an introduction. It has long been one of the bitcoin and blockchain stocks to watch. In fact, since we first covered this company in 2019, Grayscale was already building a case for a bullish move in bitcoin. Digital assets management company, Greyscale Investment manages Bitcoin Trust. GBTC acts a proxy for bitcoin price. For each of its shares, it has a backing of around 0.00094986 worth of bitcoin per share as of recent documentation on the company’s site. Grayscale had indicated even back then that there was growing institutional demand for digital assets. Little did many know just how big that demand would become.
Now some of Wall Streets well-known elite are pounding the table on bitcoin. Anthony Scaramucci, for instance, tweeted strong support as recent as December. He tweeted, “Bitcoin is in its early innings as an asset class. It’s now “on the menu” for every type of investment institution. If you’re investing today, you’re not late – not even close IMO.”
Whether or not that becomes the case, one thing is certain. That is Bitcoin prices have just etched new all-time highs in 2021. With that in mind will GBTC, a former penny stock, continue its breakneck pace?
Bitcoin Stocks To Watch: MoneyGram International Inc.
MoneyGram has a few different angles to consider. It isn’t a “pure-play” bitcoin stock like GBTC. However, its involvement in the digital currency arena can be overlooked. The money transfer giant was originally in crypto newsfeeds since blockchain company Ripple made an investment in it. MoneyGram is also focusing on a significant digital push.
A few months ago we talked about how this year’s Apple event could shed some light on companies like MoneyGram. Thanks to its digital transaction platform and mobile app, transaction growth was a high-point among traders. MoneyGram delivered 161% year-over-year cross-border transaction growth for MoneyGram Online. What’s more, is that the holiday season boosted these figures even further.
According to MoneyGram, the company delivered 142% year-over-year cross-border transaction growth and reported the largest number of transactions ever in a given month, for December. Driven by strong demand for its app and real-time capabilities to send directly to bank accounts and mobile wallets, every country with MGO capabilities delivered a record number of transactions in the month, MoneyGram said.
“As we look ahead, we’re focused on scaling even faster and ensuring our customers have the best digital experience imaginable.”Kamila Chytil , MoneyGram COO and leader of the Company’s digital business.
Since April of 2020, MGI stock has climbed from just $1.15 to highs of $8.93 and consolidated a bit into year-end. It currently trades above $6 as Bitcoin prices have helped give a boost to stocks in this niche.
Bitcoin Stocks To Watch: Marathon Patent Group
One of the more frequently discussed bitcoin stocks on our site over the last year was Marathon Patent Group. Since early May of 2020, MARA stock was on a steady rise. However, the last few months have proven to be some of the most volatile and active yet. In fact, since the start of the last quarter along (Q4 2020), shares of MARA stock have catapulted over 760% so far.
What may be even more impressive is the move it has made since the entire market sold off in March. On March 16th, shares traded as low as $0.35. That means just a few months shy of 1 year, this bitcoin penny stock has climbed as much as 4,811%. Like we’ve seen with the boom in electric vehicle stocks, hype and speculation have certainly played their roles.
However, heading into the new year, Marathon wasn’t shy about announcing the plan for 2021. Specifically, the company has purchased tens of thousands of bitcoin miners including a recent contract with Bitmain to purchase 70,000 Antminer S-19 ASIC miners in December. This added to the company’s purchase of 30,000 miners in August. With plans to deploy throughout 2021, it will be interesting to see how the landscape for bitcoin evolves and if prices can sustain at these current levels.
Bitcoin Stocks To Watch: Cleanspark Inc.
Something that I’m sure some of you have come across is the “easy” transitions that certain tech companies have had in gaining exposure to certain “hot trends”. Cleanspark, in my opinion, is one of these companies. Not only was it one of the top penny stocks of 2020, it also evolved with 2 clear trends that drove market momentum. This previously included COVID and, now, focuses on cryptocurrency.
It was during the early weeks of April that CLSK stock first came up on our watch lists. At the time, CleanSpark had just announced that its subsidiary, p2klabs, engaged AlertNest to help design a mobile app to keep people informed about local updates on coronavirus. The company also announced a joint venture with members of its multinational supply and distribution channel partners to secure medical supplies.
However, as you might guess, much of the recent excitement has stemmed from the company’s Bitcoin mining operations. This week the company announced that it produced over 31 bitcoins from its mining activities following its acquisition of wholly owned subsidiary ATL Data Centers. CEO Zach Bradford explained that the company anticipates “completion of our near-term expansion within the coming weeks adding 1,500 more ASICs miners in January.”
Those of you keeping score will also see that since March of 2020, CLSK stock has jumped from $0.97 to highs of $37.49 so far this week; a jump of nearly 3,7,65%.