Crypto
1 Top Cryptocurrency to Buy Before It Soars 6,200%, According to Cathie Wood of Ark Invest
Ark Invest’s Cathie Wood has made a name for herself as a bit of a financial maverick. She seems to like going against the grain and is unafraid of making bets — and sticking to them — that others might shy away from. For example, even with all of its recent woes, Wood is unapologetic in her backing of Tesla. Beyond these bold bets, however, are her often-bolder public predictions.
Chief among these is her belief that Bitcoin (CRYPTO: BTC) will continue to rise in price to levels that most crypto investors can only dream of. Wood is a huge proponent of Bitcoin and crypto more generally and was one of the more influential figures in getting spot Bitcoin exchange-traded funds (ETFs) approved by the Securities and Exchange Commission. During that process, she stated that her company believed Bitcoin could be worth as much as $1.5 million by the end of the decade (her base case target was $600,000, still not a bad return).
However, more recently, she has said she believes the upper target could be as high as $3.8 million by 2030. That’s a roughly 6,200% return from today’s price and represents a more than 100% annual return.
Wood’s reasoning relies on a critical component that, while possible, just isn’t likely
Let’s first make something clear. Wood was not necessarily saying she expects Bitcoin to reach $3.8 million, but rather that it is possible. Her reasoning is institutional money flooded the market after the approval of Bitcoin ETFs and that if institutional investors were to put an average of 5% of their collective portfolios into the cryptocurrency it could reach that high. This is a huge “if.”
It’s hard to put an exact number on the state of the market now, but a 2023 report from Ernst & Young states that 55% of institutional investors with more than $500 billion in assets — where the lion’s share of total assets are concentrated — say they had less than 1% allocated to “digital assets.” Sixteen percent say they had less than 0.1%. Most funds prefer traditional equities and fixed-income investments. Only roughly 7% of total managed assets are in “alternative investments,” which includes a broad array of assets, from farm land to private equity to crypto. To have a total average of 5% in just Bitcoin by 2030 is a stretch at best.
Still, it’s worth noting investors are increasingly allocating money toward Bitcoin. In fact, 12% of respondents in the same category said they had more than 5% allocated and 25% of managers of all sizes have more than 5%. The vast majority of respondents expect to raise their investments in the future as well. This additional institutional capital will add a lot of value to the Bitcoin market.
Temper your expectations and remember to think about conflicts of interest
Wood is betting big on Bitcoin. She is personally invested in it and her firm’s revenue is, in part, tied to the size of the firm’s spot Bitcoin ETF. She has a vested interest in getting people excited about the returns they could achieve by investing in Bitcoin.
I do agree with her more generally though. Bitcoin will appreciate in value and, in my opinion, at a rate that exceeds traditional equities, just not as fast as she is implying. I think Bitcoin has proven it’s here to stay at this point. We’ve likely seen the last of Bitcoin losing half its value in a day or two. However, gone also are the days when you could buy $1,000 worth and become a millionaire a few years later. Sorry — you would have had to buy in sometime before 2014. Today, you should think of Bitcoin as much more like a traditional asset.
It’s still relatively new though. There is a lot of capital on the sidelines still waiting it out or at least just dipping a toe in. The more risk-tolerant institutions have already forged a path for the industry. I think more risk-averse players like pension funds and endowments will start getting in.
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1 Top Cryptocurrency to Buy Before It Soars 6,200%, According to Cathie Wood of Ark Invest was originally published by The Motley Fool
Crypto
Robinhood shares jump 16% as company smashes estimates with 700% crypto trading growth – SiliconANGLE
Shares in Robinhood Markets Inc. jumped over 16% in late trading today after the financial services company smashed expectations on revenue and earnings in its fiscal 2024 fourth quarter.
For the quarter that ended on Dec. 31, Robinhood reported adjusted earnings per share of $1.01, up from three cents a share in the same quarter of 2023, on revenue of $1.01 billion, up 115% year-over-year. Both figures were well ahead of the 32 cents per share and revenue of $849 million expected by analysts.
Robinhood is best known for its cryptocurrency trading services and it comes as no surprise that crypto was the key driver behind the company’s strong quarter, with transaction revenue soaring eightfold year-over-year, to $358 million. The company also saw strong growth in both options and equities revenue, which were up 83% and 144% year-over-year, respectively, to $222 million and $61 million.
The amount of funds Robinhood is sitting in also delivering for the company, with net interest revenue growing 25%, to $296 million, while other revenue, which includes the company’s gold subscription service, was up 31% year-over-year to $46 million. Assets under custody as of the end of the year sat at $613 million, up over 300%.
The increasing number of assets was driven by customer growth, with funded customers growing 8%, to 25.2 million, while investment accounts grew 10%, to 26.2 million. Net deposits also rose 49%, to $50.5 billion.
Recent business highlights include a significant expansion in cryptocurrency access across the U.S. and European Union, with notional volumes surging over 400% year-over-year to $71 billion in the fourth quarter. Robinhood also added seven new crypto assets in the U.S. and launched Ethereum staking in the EU. It also moved to acquire Bitstamp, the world’s longest-running cryptocurrency exchange, with the deal expected to close in the first half of 2025.
Robinhood also rolled out index options to all customers and introduced futures trading directly in-app, enabling trades across stock indexes, energy, currency, metals and crypto. The company is also expanding globally, with plans to enter the Asia-Pacific market in 2025, setting up a regional headquarters in Singapore while recently launching options trading for U.K. customers.
For the full fiscal year 2024, Robinhood reported adjusted earnings per share of $1.56, up from a loss of 61 cents per share in 2023, on revenue of $2.95 billion, up 58% year-over-year.
“We hit the gas on product development in 2024 with a new platform for active traders, Gold Card launch, an expanded U.K. and EU product suite and much more,” co-founder and Chief Executive Vlad Tenev said in the company’s earnings release. “We see a huge opportunity ahead of us as we work toward enabling anyone, anywhere, to buy, sell or hold any financial asset and conduct any financial transaction through Robinhood.”
Given the volatile nature of the cryptocurrency market, Robinhood generally doesn’t provide outlooks and this quarter was no different, but the company did say that it expects adjusted operating expenses and stock-based compensation for the full fiscal year 2025 of $2.0 billion to $2.1 billion.
Image: SiliconANGLE/Ideogram
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Crypto
Trump's crypto company launches strategic 'token reserve'
Crypto
A Bitcoin Chart You Should See: Digital Gold Follows Real Gold (Cryptocurrency:BTC-USD)
Cogent investment views on digital assets, macro, and derivatives. BTC Maxi. My investment philosophy centers around deep fundamentals, impactful narratives, and Austrian economics. Time horizon is the primary dividing factor for investment research. Long-horizon research will focus on digital assets, macro, and general value opportunities. Emphasis is placed on a global, long-run macro view as the basis for these investment considerations. Short-horizon research will focus on options and volatility for income generation and hedging.Personally, I do business development and communications for a decentralized finance (DeFi) startup that brings capital efficient spot and derivatives trading to crypto. I have a few years of investing experience, a strong finance and economics background, and working proficiency in Python programming.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of BTC-USD, FBTC, MSTR, IBIT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
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