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Buzzwords like NFTs, DeFi, and the metaverse are everywhere nowadays. And another one has recently entered into conversations: Web3.
Also known as Web 3.0, the term was first coined back in 2014 by Gavin Wood, the co-founder of Ethereum, and it has become a focus in the future of tech. But how exactly do you invest in a developing concept like Web3?
Today, we're here to look at stocks to invest in Web3.
The history of web iterations is relatively brief. The first iteration, known as Web1, was the internet of the '90s. The connectivity was there, but it was a clunky mess.
Web2 came about in the mid-2000s during the rise of Big Tech like Google, Facebook, Twitter, etc. These companies sought to tame the wildness of Web1. This led to the consolidation of wealth and power within the web.
Now, Web3 aims to democratize the internet. It's an outgrowth of blockchain tech where services are decentralized, and the people control their data, identity, security, and transactions.
And while Web3 won't kill off Big Tech, it will bring in new alternatives. Eventually, Web3 will create markets worth trillions of dollars.
For now, it's still in its infancy. Startups dominate this early stage that only venture capitalists can invest in.
But there are different entry points into the Web3 market - you need to think outside the box to find them.
So, let's look at two stocks to invest in Web3...
Stocks to Invest in Web3, No. 2: Nvidia Corp.
When blockchain technology emerged, computer processing units (CPUs) were the unequivocal mining go-to.
Now, crypto miners use graphics processing units (GPUs) for the speed and efficiency they offer. And as blockchain technology becomes more popular, it's creating a permanent place for GPUs on the investor radar.
That's where Nvidia Corp. (NASDAQ: NVDA) comes into play.
The chipmaker is well-known for its GPUs, which power the gaming industry from hit titles like the World of Warcraft series, the Call of Duty series, and others. Nvidia's top-end GPUs cost as much as $10,000.
That's why Nvidia is a kind of "pick and shovel" blockchain play.
Crypto miners use Nvidia GPUs to mine and verify "proof of work" coins like Bitcoin. And while NVDA shares aren't affected by the swings in the crypto market, they're exposed to the upside that comes with the expansion of crypto mining.
Nvidia stock skyrocketed more than 200% over the past five years, yet the biggest gains are still ahead of the chipmaker. For that, it's a solid buy -- based on its past growth and the future of blockchain tech.
The chipmaker benefits from new tech trends that will spur more demand for its products, and the development of Web3 should prove no different.
As a bonus, Nvidia also has a significant stake in the metaverse in the form of its Omniverse 3D software platform. Omniverse provides developers the necessary tools to build virtual spaces within the metaverse, making it a two-pronged investment.
Stocks to Invest in Web3, No. 1: Coinbase Inc.
When Bitcoin (BTC) hit the scene, it traded for $0. Many thought it was a joke. By 2013, a single token was trading at $80. As Bitcoin's value grew over time, investors sought a safe place to trade and store their tokens.
Coinbase Inc. (NASDAQ: COIN) was the solution for many. The crypto app offered security, transparency, and liquidity that few others could match at the time.
And when it comes to Web3, Coinbase benefits as more people start trading Web3-focused tokens. As of now, there are quite a few of the Web3 tokens available on Coinbase; it's likely more will be added as demand increases.
But Coinbase stock has had a rough ride since its debut last May, now trading at $169 - not far above its 52-week low.
The thing is... COIN is significantly undervalued.
As far as the numbers go, it's one of the most downloaded apps on the Apple App Store, with over 1.5 million downloads since its 2014 debut. An estimated 8.8 million people trade on the platform every month. And roughly 73 million people are using Coinbase worldwide.
So, it's safe to say that Coinbase isn't going anywhere anytime soon.
While Coinbase is just a crypto-trading platform at a glance, it's much more than that. And it's quickly become the go-to platform in America's growing crypto market. Not to mention, it's one of the only crypto-trading platforms with regulatory approval.
Plan on Coinbase being a major player in the growing world of Web3 tokens, making it one of the more notable stocks to invest in Web3. As a result of Coinbase's utility, CNN analysts set a price forecast of $600 per share.
That means that if you bought into COIN at its current price of $169, you could see potential gains of more than 250% over the next 12 months.
The Next Tech Rush: How "the Metaverse" Is Creating $753 Billion in New Wealth
The Metaverse: It's the evolution of the internet - a shared virtual world where people gather to play games, socialize, buy things, and work.
Big Tech is actively spending billions of dollars to develop it... and three small players could take all.
Each one (two are stocks and one is a crypto) is trading for less than $30 and could soar 1,000% over the next few years.
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