How to buy blockchain stocks
- Open your brokerage app: Log in to your brokerage account where you handle your investments.
- Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Benefits and risks of investing in blockchain stocks
Blockchain technology is still relatively young and is evolving rapidly. Plus, there are several ways AI technology can enhance blockchain and the companies that operate in the space.
The benefits of investing in blockchain stocks include:
- Growth potential of a rapidly evolving technology trend.
- Portfolio diversification, especially if you're heavily invested in other tech trends like AI.
- Exposure to a structural shift in financial technology.
However, there are some big risk factors to keep in mind:
- The biggest drawback is volatility. For example, Riot Platforms has a beta of 3.81, which implies that it is almost four times as volatile as the typical S&P 500 stock.
- Regulatory uncertainty is another, as the SEC and other regulatory agencies can change how they govern cryptocurrencies.
- There's also security risk, as high-profile hacks and data breaches can derail affected companies.
The bottom line
Notice that all 10 of these stocks are either well-established businesses or leaders in their respective industries (or ETFs that invest in a variety of companies).
Although blockchain technology has been around for some time, it’s still in the early stages of real-world implementation. Blockchain has the potential to significantly affect finance, technology, and various other industries in the coming years, though its widespread adoption may take longer to materialize. For this reason, it's smart to focus on companies that will benefit from the growth of blockchain technology, but will remain resilient even if their blockchain initiatives don't succeed.