Forget Ripple (XRP): Buy These 2 Top Crypto Stocks Instead

Instead of directly betting on cryptocurrencies like Ripple, you could invest in these cryptocurrency stocks.

| More on:
crypto, chart, stocks

Image source: Getty Images

Ripple (CRYPTO:XRP) is continuing to trade on a negative note lately. After the U.S. Securities and Exchange Commission filed a legal complaint against the California-based Ripple Labs on December 22, the value of XRP has dived nearly 40% against the U.S. dollar within a month. While the digital token has seen a recovery since then, its future trends remain uncertain, as the ongoing legal battle could keep it extremely volatile.

Forget Ripple: Buy these crypto stocks instead

While directly investing in cryptocurrencies like Ripple might expose you to several risks, you may find it relatively less risky and more convenient to invest in crypto stocks instead. This way, you could avoid big risks to your investment portfolio and still benefit from the heating-up cryptocurrency market. Let’s take a closer look at two such cryptocurrency stocks in Canada that could help you get high returns in the long run.

Bitfarms stock

Bitfarms (TSXV:BITF)(NASDAQ:BITF) is a Toronto-based cryptocurrency miner with a market cap of about $867 million. Its TSX Venture Exchange-listed stock has seen a steep drop in 2022 so far after posting 155% gains in 2021 and solid 400% gains in 2020. Its stock currently trades at $4.39 per share with about 31.2% year-to-date losses.

In Q3 2021, Bitfarms reported a 38% sequential increase in its Bitcoin production to 1,051 BTC compared to 759 BTC in the previous quarter. During the quarter, its average BTC production cost also fell by 23% sequentially to US$6,900 per BTC. As a result, the company’s adjusted net earnings rose to US$0.22 per share in Q3 from US$0.07 per share in the previous quarter, beating analysts’ estimates of US$0.20 per share.

To accumulate more low-cost Bitcoin, Bitfarms purchased 1,000 BTC in the first week of January for about US$43.2 million. An expected recovery in Bitcoin prices could prove this investment highly profitable for the company and drive this Canadian crypto stock higher.

Hut 8 Mining stock

Hut 8 Mining (TSX:HUT)(NASDAQ:HUT) could be another great Canadian stock for investors who are looking for exposure to the cryptocurrency market. It’s one of the largest cryptocurrency miners in North America, with a market cap of nearly $1.3 billion. After posting 828% gains in 2019 and 2020 combined, HUT stock has lost nearly 24% of its value in 2022 so far.

Hut 8’s 2021 total revenue is expected to jump to US$178.5 million — four times compared to $40.7 million in the previous year. Its self-mined Bitcoin reserve continues to swell with the help of its consistently increasing Bitcoin production. Given that, its 2021 earnings are expected to grow by six times from 2020 to about $0.36 per share.

To expand its infrastructure further, Hut 8 Mining recently acquired the cloud and colocation data centre business from TeraGo. Last month, Hut 8 mined 308 Bitcoin at an average production rate of 9.93 Bitcoin per day. After adding these Bitcoin to its reserves, the company held 5,826 Bitcoin as of January 31. These growth factors make this crypto stock worth considering right now.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

The Motley Fool owns and recommends Bitcoin. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.

More on Investing

grow dividends

Don’t Look Now, But These 3 TSX Stocks Look Poised for a Nice Rally

Three TSX stocks are rising amid the elevated market volatility due to rate-cut uncertainties and geopolitical risks.

Read more »

Close up shot of senior couple holding hand. Loving couple sitting together and holding hands. Focus on hands.
Dividend Stocks

Here’s the Average CPP Benefit at Age 70 in 2024

Canadian retirees can supplement their CPP payout by investing in blue-chip dividend stocks such as Enbridge.

Read more »

woman data analyze
Tech Stocks

1 Stock I’d Drop From the “Magnificent 7” and 1 I’d Add

Tesla (NASDAQ:TSLA) stock is part of the Magnificent Seven, but Shopify (TSX:SHOP) is growing faster.

Read more »

Gas pipelines
Dividend Stocks

Is Enbridge the Best Dividend Stock for You?

Enbridge now offer a dividend yield of 8%.

Read more »

tsx today
Stock Market

TSX Today: What to Watch for in Stocks on Thursday, April 18

Rising metal prices could lift the main TSX index at the open today as focus remains on the ongoing geopolitical…

Read more »

Hand arranging wood block stacking as step stair with arrow up.

2 Pandemic Stocks That Are Still Rising, and 1 Offering a Major Deal

There are some pandemic stocks that crashed and burned, while others have made a massive comeback. And this one stock…

Read more »

Supermarket aisle with empty green shopping cart

CRA: Will You Receive a Grocery Rebate in 2024?

The grocery rebate was introduced as a one-time tax credit for low-income Canadian households to offset higher prices.

Read more »

question marks written reminders tickets

BCE Stock’s Dividend Yield Hits 9%—Is it Finally Time to Buy?

BCE (TSX:BCE) stock has a super-swollen dividend yield right now as it passes 9%.

Read more »