COIN

3 Crypto Investments That Dwarfed Shiba Inu in 2023

Shiba Inu (CRYPTO: SHIB) is a popular meme coin for crypto investors. And it had a good year in 2023, with its value rising by just under 38%. But that pales in comparison to some of the returns crypto stocks generated for investors last year. Coinbase Global (NASDAQ: COIN), Bitfarms (NASDAQ: BITF), and Marathon Digital (NASDAQ: MARA) all more than quadrupled in value in 2023. Here's why investing in these stocks may be a better option for crypto investors than betting on Shiba Inu.

1. Coinbase Global

Coinbase Global runs a top cryptocurrency platform that makes it easy for people to buy and trade digital currencies. And with Bitcoin surging in value in recent months and interest high thanks to excitement relating to the approval of a Bitcoin spot exchange-traded fund, there could be an uptick in trading this year.

In its most recent quarter (ended Sept. 30, 2023), Coinbase reported revenue of $674 million, which rose by 14% year over year. And the company's net loss for the period also shrank to just under $2.3 million from nearly $545 million in the prior-year period.

Last year, shares of Coinbase jumped by 335%, thanks in large part to the rise of Bitcoin during the latter part of 2023. The company could do well not only from the continued rise of Bitcoin but as it expands its operations. Recently, Coinbase announced plans to acquire a company that would give it a presence in the crypto derivative market in the E.U., which may drive even more growth for the business.

Coinbase is unprofitable but it's getting close to breakeven. And with more growth on the horizon, it's a much safer investment option than Shiba Inu. For crypto investors willing to take on some risk, Coinbase could be a good buy.

2. Bitfarms

A crypto stock with even greater gains last year was Bitcoin mining company Bitfarms. Its shares rose by an incredible 518%. The Canadian-based company has been investing into improving its production capacity and its exahash rate (EH) has increased 44% year over year, to 6.5 EH/s. A higher EH/s rate means a higher likelihood that it will successfully mine Bitcoin.

With a Bitcoin halving event likely taking place this year, which will cut the mining rewards in half, it becomes much more imperative for mining companies to improve on their efficiency. Bitfarms is aiming to get its EH/s rate up to 12 by the second quarter of 2024, and potentially as high as 17 before the end of the year.

Over the past four quarters, Bitfarms has incurred a net loss of $64 million. While the stock has the potential to do well this year if Bitcoin continues rising in value, investors should be careful with the crypto stock. It could be a volatile investment, as it will depend heavily on how Bitcoin performs.

If you don't have a high risk tolerance, you may want to keep Bitfarms on your watch list rather than in your portfolio.

3. Marathon Digital

Marathon Digital's stock was up a whopping 605% last year, proving to be one of the hottest crypto stocks on the markets in 2023. Another Bitcoin mining company, Marathon is in much better shape than Bitfarms.

Marathon Digital recently entered into an agreement to acquire a couple of Bitcoin mining sites for $179 million, which will increase its mining capacity by 56%. Over the next two years, it believes it can get to a rate of 50 EH/s. The deal will also increase its baseline revenue for 2024 by 50%. What's also impressive is that Marathon won't require any debt or need to issue stock to help fund the acquisition, either.

Like the other stocks on this list, Marathon isn't profitable -- its net loss over the past four quarters totals $269 million. If the price of Bitcoin soars this year, Marathon Digital's stock could be a big winner. While it's another risky investment, it could be the most attractive Bitcoin mining stock given its growth potential.

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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Coinbase Global. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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