Square, Nvdia, AMD: How Is Our Cryptocurrency Theme Faring?

Our indicative theme on Cryptocurrency Stocks – which includes semiconductor, payments, and brokerage players who have exposure to bitcoin and cryptocurrencies – gained about 5% over the last week on an equally weighted basis and is up a solid  80% year-to-date. This compares to the S&P 500 which remains almost flat year-to-date.  The theme could be of interest to investors who are looking for upside from cryptocurrency adoption and prices, but want to avoid buying into cryptocurrencies themselves considering the volatility, risk of fraud or cybertheft, or potential portfolio mandates.  Square (NYSE:SQ), up 152% year-to-date (YTD), is the primary driver of the theme’s return this year. On the other side, CME Group (CME), is down roughly -16% this year. Here’s a quick rundown of some of the stocks and their performance over the past year.

Square‘s Cash mobile wallet app has emerged as a very popular way for people to buy and sell Bitcoin. The stock has gained a whopping 152% year-to-date, as investors bet that Square’s digital payment solutions will continue to gain traction through and post Covid-19. The stock rallied about 9% over the last week.

Nvdia (NVDA): a semiconductor company best known for its graphic processing units (GPU) that are increasingly used in machine learning and AI, is also finding application in bitcoin mining. The stock has gained over 110% year to date and was up about 6% over the last week. (related: Nvidia Stock Headed Toward $700?)

Advanced Micro Devices (AMD), is a semiconductor major that makes CPUs and GPUs, which are increasingly used in bitcoin mining. The stock has gained about 70% year-to-date and about 4% over the last week.

AMD

PayPal Holdings, Inc. (PYPL), a large online payments processor, is planning to offer cryptocurrency purchases via its PayPal and Venmo apps. The stock has gained about 73% year-to-date and was up by about 6% last week.

CME Group (CME): the world’s largest financial derivatives exchange, also offers bitcoin futures contracts. The stock is down by about 16% year-to-date, and declined by about 1% over the last week.

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