A big repercussion for digital money has been caused by expanding markets in cryptocurrencies.
Many investors turned the time during the pandemic in a tidy profit. In particular, owners of bitcoin which overall increased over 300% in value. But what about the stocks that will benefit from the long-term growth in the usage of digital assets. CME Group could be the most excellent business for investing in the trend.
Cryptocurrency prices are a good a short-term measure of supply and demand in relation to any asset value in the short term, stocks included.
Cryptocurrencies were in very high demand in 2020 in relation to the inadequate supply of digital monies in actual distribution.
Moreover, it seems there is long-term growth in acceptance of digital currency, and we should not be too worried about wild swings in cryptocurrency prices themselves. Many suggest that CME Group can be one of these great long-term investments.
CME Group is the world’s leading marketplace of derivatives contracts for a lengthy catalogue of things from company stock to commodities like oil and agricultural products to currencies like the U.S. dollar. CME is a cost-effective and very lucrative facilitator of risk transference. The marketplace produced free cash flow of $1.77 billion on revenue of $3.73 billion through the first nine months of 2020 and the company has a nearly two-decade-long track record paying a steadily rising quarterly dividend.
So, what this has to do with cryptocurrencies? CME launched futures agreements on bitcoin in 2017, extended the market to include bitcoin futures opportunities in early 2020, and will include a new cryptocurrency marketplace via Ether futures. Derivatives contracts on the two leading crypto assets are a great deal if you think that the implementation of digital currency will rise over time. CME gets a fee every time a deal is done.
Consequently, if you believe that digital currency practicality will rise over time, it seems CME Group is a great place to add to your investment portfolio.