Crypto stocks with growth potential

What happened: Circle, a stablecoin-focused company, is seen as a potential tenfold growth play by 2030. Coinbase is expanding its exchange offerings beyond cryptocurrencies. TD Cowen initiated coverage on four crypto stocks - Sharplink, Strive, Nakamoto Holdings, and The Mawson Infrastructure Group - while cutting its price target on Marathon Patent Group (Strategy). Bitcoin, the leading cryptocurrency, has lost 60% of its value this year, with macro headwinds such as elevated interest rates weighing it down.

Market impact: The crypto sector is experiencing a shift in growth potential, with stablecoins and diversified exchanges gaining traction. This could lead to increased investment in companies like Circle and Coinbase, driving up their stock prices. The crypto treasury trade is becoming less uniform, with more companies adopting Bitcoin and other cryptocurrencies as part of their treasury strategies. However, the overall crypto market's performance, as exemplified by Bitcoin's decline, could impact the entire sector.

What to watch next: Circle's upcoming earnings report (Q3 2022, expected in late October) will provide insights into its stablecoin growth. Coinbase's Q3 2022 earnings (expected in early November) will reveal the impact of its expanded offerings. The U.S. Federal Reserve's interest rate decision in late October could influence the broader crypto market's performance. Additionally, regulatory clarity on crypto from major economies could significantly impact the narrative around crypto stocks.