Bitcoin’s path to $100,000 is less important than its potential impact on the corporate world over the next decade, Wedbush says

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  • Dan Ives of Wedbush said bitcoin’s effect on the corporate world is more important than its price.
  • The analyst argued moves into blockchain tech and cryptocurrencies may surge over the coming years.
  • “Bitcoin mania is not a fad…but rather the start of a new age on the digital currency front.”
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Bitcoin’s path to $100,000 per coin is less important than its potential impact on the corporate world over the next decade, according to Wedbush.

In a note to clients on Thursday, Wedbush’s Dan Ives said that the story around bitcoin is much larger than its “potential path/timeline to $100,000.”

The analyst argued the important theme when it comes to cryptocurrencies is “the potential ramifications that crypto, blockchain, and Bitcoin could have across the technology and corporate world for the next decade.”

Ives said moves into blockchain technology and cryptocurrencies could surge over the coming years after companies like Tesla, IBM, Visa, Square, Mastercard, and more entered the fray recently.

There’s a “growing shift for companies to accept this digital currency as a form of payment,” according to the analyst.

Ives added that he still believes “less than 5% of public companies” will invest in bitcoin over the next 12-18 months but said that number could move “markedly higher” as more regulation and acceptance of the currency takes hold.

“Bitcoin mania is not a fad in our opinion, but rather the start of a new age on the digital currency front,” Ives wrote.

Although Ives was one of the first to the party, his comments about cryptocurrencies and their regulation are becoming more in sync with other Street commentators and even CEOs as cryptocurrencies and blockchain technologies continue to develop.

David Solomon, the CEO of Goldman Sachs, said his bank is looking into ways to support clients’ desire to own cryptocurrencies and other digital assets in a CNBC “Squawk Box” interview on Tuesday.

The CEO added that he believes there will be a “big evolution” in the way the US government regulates digital assets in the coming years.

Ives and his team also highlighted the potential of using blockchain technology for decentralized storage in their note to clients on Thursday.

The analyst said blockchain technology can help increase the overall speed and lower the price of digital storage moving forward. He noted, “there are a number of business models attacking this new market opportunity with privately-held Filecoin one of the more impressive strategies we have seen in the market.”

As far as Wedbush is concerned, Bitcoin isn’t going away anytime soon, rather it’s set to become “mainstream” and the effects on Wall Street and the corporate world will be huge.

Coinbase’s 840% revenue jump in the first quarter may be the perfect example of what Ives is talking about.

Coinbase posted $1.8 billion in revenue in its first-quarter report. That means the crypto exchange pulled in over $120 million more than Intercontinental Exchange, the company that owns the New York Stock Exchange, did in its most recent earnings report.

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Tech stocks can soar another 25% as reopening boosts digital transformations, Wedbush says

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  • Tech stocks will climb 25% or more over the next year as economic-reopening progress spurs new growth, Wedbush said Tuesday.
  • FAANG, cloud, and cybersecurity names will lead the climb, while Uber and Lyft represent the best reopening plays, they added.
  • Valuation concerns are valid, but secular trends lifting the group will offset such worries, according to Wedbush.
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The trends poised to lift all manner of tech stocks are only just beginning, Wedbush analysts Dan Ives and Strecker Backe said.

Equity investors are in the midst of a transition. While tech mega-caps and other growth stocks led the bulk of last year’s rally, expectations for a swift economic reopening recently shifted attention toward companies set to benefit most from a recovery. Value and cyclical names have roared higher and left tech names lagging.

Wedbush doesn’t expect the underperformance to last. Blowout earnings from pandemic-darling Zoom show tech stocks are set for another quarter of “beat and raise” reports, the analysts said. Digital transformations will take hold soon after and lift tech stocks by 25% or more over the next 12 months, they added.¬†

“As we have witnessed in the cloud, collaboration, cybersecurity, and 5G, this tech party is just getting started with consumer and enterprise-driven demand catalyzing a multi-year growth boom for the tech sector looking ahead,” the team said.

Wedbush sees¬†FAANG, cloud, and cybersecurity stocks leading the charge. Disruptive recovery names like Uber and Lyft are the firm’s favorite reopening plays, as lifted restrictions will likely revive ridership.

The political backdrop also lends itself to continued strength in tech stocks, according to Wedbush. The Biden administration will likely have a softer tone against China and ease tensions in the “Cold Tech War,” the analysts said. The 2020 SolarWinds hack also places a fresh focus on cybersecurity efforts in government, they added.

To be sure, the tech sector still enjoys elevated valuations following last year’s rally. Debate over the stocks’ pricing will continue, but Ives and Backe expect the group to swing higher even in the face of the broader rotation to value.

“We believe the underlying fundamental stories and white-hot growth creates a yellow brick road to an upward bullish trend,” they said.

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