20th Dec 2021
Non fungible tokens, or NFTs, have enjoyed a lot of media buzz in the last year, making NFT stocks one of the year’s hot new investing trends. More and more people are considering either buying NFTs, or choosing non fungible tokens stocks to add to their portfolio.
What are NFT stocks?
In brief, an NFT is a digital token that’s based on blockchain. It’s connected unbreakably with a specific digital asset, which could be anything from a piece of digital art to a parcel of virtual land.
NFTs are attracting so much attention because they make it possible to track and prove ownership over a digital asset. That means that people can buy, sell, or store them, and watch the value of the NFT change over time, just like any physical asset, creating a whole new market in digital items.
NFTs are also being adopted to secure physical assets, like physical artwork or physical real estate. The blockchain-based system records every transaction and cannot be altered, making it a reliable way to verify ownership and track provenance of physical and digital items.
Why should you invest in NFTs?
People’s reasons for investing in NFTs, whether that’s by choosing NFT stocks to invest in or buying NFTs themselves, vary greatly. Some are excited to be part of a disruptive trend and want to have a share in the newest technology. Others see immense potential value in NFTs and want to get in on the ground floor.
NFTs are already adding new value to gaming, creating new relationships between artists and their supporters, and opening up new communities of like-minded individuals around the world. Thought leaders predict that in time, NFTs could even form the basis for new models of work, develop new markets, and establish a foundation for democratic states.
If you’re tempted by the rising trend of NFTs and want to find the best NFT stocks, here’s a short list of some NFT stocks to buy.
1. Defiance NFT ETF (NFTZ)
NFTZ is an ETF issued by Defiance ETFs rather than a single NFT stock. That means that with a single investment, you can have shares in multiple promising NFT stocks. ETF stands for exchange-traded fund, which is similar to index funds, with the crucial difference that you can trade an ETF whenever you like.
All the holdings in NFTZ are involved in some aspect of the NFT ecosystem, including NFT infrastructure like trading platforms and marketplaces, the blockchain and cryptocurrency networks that serve as the foundation for NFTs, or support for the creation and commercialization of NFTs.
As the first NFT ETF, NFTZ seeks to track the composition of the BITA NFT and Blockchain Select Index, maintained by the German fintech company BITA. The Index is reconstituted and rebalanced quarterly, and all components are weighted between 0.5% to 4%.
2. Coinbase (COIN)
Coinbase is relatively venerable for a crypto and blockchain company, having been established in 2012 near the beginning of the cryptocurrency revolution. Coinbase operates an easy to use cryptocurrency exchange platform in over 100 countries that has amassed approximately 73 million verified users and 185,000 partners.
Coinbase is a gateway into the world of NFTs, allowing users to convert fiat currency into the cryptocurrency of their choice in order to purchase and trade NFTs. In late 2021, it announced the addition of an NFT marketplace, to make it easier for people to trade NFTs. 1
3. CleanSpark (CLSK)
Most NFTs are bought and sold using cryptocurrency, giving crypto mining companies like CleanSpark a place in most lists of NFT stocks. CleanSpark is a sustainable crypto mining company that uses more energy efficient microgrids and renewable energy to mine bitcoin and other cryptocurrencies. It maintains a focus on ESG (environmental, social and governance) practices and aims to solve modern energy challenges, while raising the ethical standard for crypto mining.
CleanSpark is continuing to steadily add mining machines, with the goal of reaching 3.2 exahash (an algorithmic-powered measure of processing power) of computing power by late 2022.2
4. Silvergate Capital (SI)
Silvergate Capital is a relatively small bank, based in San Diego, California, that’s one of the first banks to move into the cryptocurrency space and is now entirely focused on crypto. Its clients include 93 crypto exchanges, which use Silvergate’s bank accounts to move the dollars that underpin their crypto trades.
Silvergate also runs its own crypto trading network, the Silvergate Exchange Network, or SEN, for people and institutions to carry out crypto exchanges, and supports a number of stablecoins. Analysts view Silvergate as having captured a significant share of the crypto exchange market.3
5. Dolphin Entertainment Inc (DLPN)
Dolphin Entertainment is a conglomerate of entertainment marketing and content development companies, and it includes a number of digital content creators among its clients. It recently announced a partnership with the owners of the crypto exchange company FTX.US to build and program an NFT marketplace for leading sports, gaming, charity, and entertainment brands to mint and market their own NFTs.
Dolphin’s move into the NFT space gave a boost to its stock, and analysts consider it a serious rival to DraftKings, an online sports gaming and entertainment brand which also recently announced the creation of a new NFT marketplace.4
6. WIseKey International Holdings (WIHN)
WISeKey offers an integrated security platform for online transactions, thereby authenticating and verifying interactions like NFT trading. Its NFT products include WISe.art, an NFT marketplace for digital assets. WISeKey mints NFTs linked to historical artefacts, artworks, and luxury items and auctions them on its platform.
Recently, WISeKey announced that its WISeID technology will now enable users to mint digital identity NFTs. That means that people can create digital personas, authenticate their ownership, verify their identity, and then securely create, sign, and verify claims in the emerging virtual metaverse.
WISeKey has been delivering digital security solutions for over 20 years.5
1 https://capital.com/coinbase-stock-price-prediction https://finance.yahoo.com/news/coinbase-revenues-could-hit-nearly-235245858.html
3 https://www.nasdaq.com/articles/this-under-the-radar-crypto-bank-is-skyrocketing-2021-09-15 https://www.fool.com/investing/2021/11/02/why-silvergate-capital-is-my-favorite-fintech-stoc/
5 https://money.cnn.com/quote/forecast/forecast.html?symb=WKEY#:~:text=Stock%20Price%20Forecast,the%20last%20price%20of%205.07. https://www.wallstreetzen.com/stocks/us/nasdaq/wkey/stock-forecast