Cryptocurrencies have been suffering over the past week, with Bitcoin (BTC) retreating sharply from its all-time high attained in the final weeks of December. Several factors have been posing as a barrier to Bitcoin’s northbound journey.
Growing concerns over a potential global trade war, following the announcement of retaliatory tariffs by China and President Donald Trump’s levies on all steel and aluminum exports, have been denting investors’ confidence. Bitcoin fell below $97,000 on Monday. However, the decline is temporary, and the rally is expected to resume once these fears wane and investors get a clearer picture of the Federal Reserve’s plans with its rate cuts.
However, the cryptocurrency’s decline is temporary and the rally is expected to resume once these fears fade. Bitcoin-centric stocks like Robinhood Markets, Inc. HOOD, Interactive Brokers Group, Inc. IBKR, Visa Inc. V and PayPal Holdings, Inc. PYPL would thus be a lucrative buy. These stocks have strong growth potential for 2025. Each of these stocks has seen positive earnings estimate revision in the last 60 days.
Bitcoin was hovering around $96,100 late Monday, a sharp decline from $102,000, which the cryptocurrency maintained over the past month after hitting an all-time high of $106,533 on Dec. 22.
The recent decline is being triggered by fears of a global trade war after Trump, earlier this week, announced his plans to impose tariffs on all steel and aluminum exports. Also, Beijing has already announced retaliatory tariffs after Trump announced 10% tariffs on Chinese imports.
Earlier this month, Trump announced 25% tariffs on all Mexican and Canadian imports before stalling it for a month, following negotiations. These fears have been unsettling the broader market and cryptocurrencies, too, are feeling the heat.
Investors have also been waiting for January’s inflation reading as this could give them a clearer view of how the Federal Reserve plans to go ahead with its rate cut plans. Inflation jumped in the final months of 2024, which saw the Federal Reserve leave interest rates unchanged in January after three consecutive rate cuts totaling 100 basis points.
The surge in inflation has also made experts adjust their forecasts with rate cuts. Market participants were earlier expecting the Fed to resume its rate cuts in March but now believe that the central bank will take a more cautious stance and won’t go for a rate cut before May.
Higher interest rates can impact cryptocurrencies negatively by dampening investors’ interest in riskier assets, increasing the opportunity cost of holding non-yielding assets like Bitcoin, and boosting the U.S. dollar, which typically puts pressure on cryptocurrencies.
That said, Bitcoin had a stellar 2024, with the cryptocurrency jumping more than 92% year to date. Also, investors are optimistic that the Trump administration will announce pro-crypto policy changes in the near term. Moreover, Bitcoin has reached record highs every four years during its last two bullish cycles since 2017. In these cycles, it gained 2300% and 1700%, followed by corrections of 70% to 80%. From its low of $16,000 in early 2023, Bitcoin has surged almost 600%, indicating strong potential for growth in the near term.
Robinhood Markets, Inc. 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 more than 100%.The Zacks Consensus Estimate for current-year earnings has improved 21.3% over the last 60 days. Robinhood Markets currently has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Interactive Brokers Group, Inc. is a global automated electronic broker. IBKR executes, processes and trades in cryptocurrencies. IBKR’s commodities futures trading desk also offers customers a chance to trade cryptocurrency futures.
Interactive Brokers Group has an expected earnings growth rate of 5.1% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 4.8% over the last 60 days. IBKR currently has a Zacks Rank #1.
Visa Inc. is taking a significant step toward modernizing cross-border money movement. In a move aimed at enhancing the efficiency of global transactions, V is expanding its stablecoin settlement capabilities to the high-performing Solana blockchain. This expansion of V includes collaboration with prominent merchant acquirers Worldpay and Nuvei, marking a pivotal development in the world of digital payments.
Visa Inc.’s expected earnings growth rate for the current year is 12.4%. The Zacks Consensus Estimate for current-year earnings has improved 0.6% over the last 60 days. V currently has a Zacks Rank #2 (Buy).
PayPal Holdings, Inc. provides digital wallet services that enable users to purchase, transfer, and sell various cryptocurrencies, such as Bitcoin, Ethereum, Bitcoin Cash and Litecoin. Through PYPL, users can use cryptocurrencies to pay for goods and services from online merchants. Additionally, PayPal’s mobile wallet platform, Venmo, allows users to engage in cryptocurrency buying and selling activities.
PayPal Holdings’ expected earnings growth rate for the current year is 8%. The Zacks Consensus Estimate for current-year earnings has improved 2.7% over the last 60 days. PYPL currently has a Zacks Rank #2.
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