Cryptocurrencies have been struggling lately after a solid 2023 and Q1. Bitcoin (BTC), in particular, was leading from the front, which also saw the world’s most popular cryptocurrency reach an all-time high of $73,750 in March.

However, the recovery appears to have stalled since then and cryptocurrencies have struggled, with Bitcoin trading sharply below $70,000 for most of May. June was no different either. On June 13, Bitcoin fell below $67,000 before recovering some of its losses and was trading at $67,100.

Many factors are behind this recent Bitcoin decline. The Bitcoin halving event in April was one of the main reasons for the cryptocurrency’s price decline.

The halving event, which happens every four years, reduces the block reward by 50%, with the aim of capping the total supply of Bitcoin at 21 million coins. This reduction in the rate of supply of new Bitcoins generally increases the demand for cryptocurrencies, often leading to an increase in prices.

It was predicted that Bitcoin would regain momentum after the end of the halving event, but this did not happen. Furthermore, Wall Street’s recovery was halted in April due to growing concerns about rising inflation and potential interest rate hikes.

Although inflation eased in April and May, easing fears of another rate hike, the lack of clarity about the Fed’s rate-cutting plans hurt investor confidence. Federal Reserve Chairman Jerome Powell said after the FOMC meeting that the Fed anticipates just one rate cut this year, significantly below the three projected at its March meeting.

Powell also said that although inflation has declined sharply over the past year, it remains sharply above the Fed’s 2% target. Therefore, the Fed is likely to maintain the higher interest rate for a longer period.

Higher interest rates negatively impact growth assets such as technology stocks, consumer discretionary stocks and cryptocurrencies.

However, even so, experts believe that Bitcoin has tremendous potential and that the recent decline is temporary. Year-to-date, Bitcoin has gained 45.5% after rising more than 207% in 2023.

Our choices

We’ve narrowed down our research to four crypto-focused stocks with strong potential for 2024. Each of our picks carries a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold). You can see The complete list of today’s Zacks #1 Rank stocks here.

NVIDIA Corporation NVDA is the world leader in visual computing technologies and the inventor of the graphics processing unit, or GPU. Over the years, NVDA’s focus has evolved from PC graphics to artificial intelligence-based solutions that now support high-performance computing, gaming, and virtual reality platforms.

The story continues

NVIDIA has an expected earnings growth rate of 106.2% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 12.6% over the past 60 days. NVDA currently sports a Zacks Rank #1.

Interactive Brokers Group, Inc. IBKR is a global automated electronic broker. IBKR executes, processes and trades cryptocurrencies. The IBKR commodity futures trading desk also offers clients the opportunity to trade cryptocurrency futures.

Interactive Brokers Group has an expected earnings growth rate of 14.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2% over the past 60 days. IBKR currently has a Zacks Rank #2.

Robinhood Markets, Inc. HOOD operates a financial services platform in the United States. Its platform allows users to invest in stocks, exchange-traded funds, options, gold, and cryptocurrencies. HOOD buys and sells Bitcoin, Ethereum, Dogecoin and other cryptocurrencies using its Robinhood Crypto platform.

Robinhood Markets’ expected earnings growth rate for the current year is over 100%. The Zacks Consensus Estimate for current-year earnings has improved 110.3% over the past 60 days. Robinhood Markets currently has a Zacks Rank #2.

Coinbase Global, Inc. COIN provides financial infrastructure and technology to support the global cryptocurrency economy. COIN provides a primary financial account for consumers in the crypto space, a liquid marketplace for institutional transactions of crypto assets, and technology and services for developers to create crypto-based applications and securely accept cryptocurrencies as payment.

Coinbase Global’s expected earnings growth rate for the current year is over 100%. The Zacks Consensus Estimate for current-year earnings has improved 219.1% over the past 60 days. Coinbase currently sports a Zacks Rank #1.

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