Analysts at popular trading website Motley Fool have recommended a lesser-known bank stock that also focuses on cryptocurrencies, following a Citi report that downgraded its shares of business intelligence firm Microstrategy to a sell rating.
Last Tuesday, Citi analyst Tyler Radke downgraded Microstrategy (NASDAQ: MSTR) shortly after the company announced a debt purchase that would bring its Bitcoin holdings to nearly $ 1 billion.
In the report, the company, whose share prices had more than tripled from $ 92 lows at certain points, was criticized for its “disproportionate” focus on strengthening its BTC holdings, saying the current run was “overwhelmed”.
However, in a recap article today, Motley Fool analysts suggested that the little-known, crypto-focused small cap Silvergate Capital (NYSE: SI) might be worth a look for traders looking to capitalize on the next crypto game.
Silvergate – the La Jolla, California-based bank with over $ 2 billion in assets under management – has an impressive list of cryptocurrency companies as clients, including Coinbase, Paxos, Circle, Gemini and Polychain Capital.
Motley Fool reps Matt Frankel and Justin Moser pointed to the banks’ 21-year profitability streak, $ 50 million BTC on the books, and a loan book of mostly commercial mortgages. Both analysts also recommended the bank as a superior investment to discover BTC.
A previous Motley Fool article earlier this week also drew attention to the crypto exchange infrastructure Silvergate has built for its customers, the Silvergate Exchange Network (SEN). SEN acts as a 24-hour intermediary between exchanges and their institutional customers who buy and sell cryptocurrencies, unlike normal banks that would be restricted by normal working hours. SEN has reportedly released over $ 100 billion since its inception.
SI currently stands at a value for money of 36.69, offers a dividend of 10.36% and is up almost 100% year over year.
Silvergate and Microstrategy aren’t the only publicly traded blockchain stocks that are seeing strong investor interest. Mining giant Riot Blockchain is also at risk after appointing new members to its board of directors.