Goldman says these stocks are bouncing with bitcoin — and outperforming the S&P 500 in a big way

Published Tue, May 4 20213:48 AM EDTUpdated Tue, May 4 20213:56 AM EDT

As bitcoin and other digital currencies surge in price, investors are looking for other ways to play the crypto craze. Bitcoin is up over 90% since the start of 2021, even after a recent slide in prices saw the market shed more than $200 billion in value. Ether, the second-largest digital coin by market value, has climbed almost 350% year-to-date. In a note published Thursday, analysts at Goldman Sachs named a list of stocks that are bouncing alongside bitcoin. The bank found that, on average, these stocks have significantly outperformed the S & P 500 this year. The Goldman analysts screened for stocks with exposure to both cryptocurrencies and their underlying blockchain technology. To do this, they searched company filings, earnings calls and news stories for any mention of keywords like "blockchain" and "cryptocurrency" in the past 12 months. They also looked at indexes and exchange-traded funds (ETFs) that included blockchain-related stocks. The companies had to be worth more than $1 billion to meet the criteria. The stocks that fit the bill (ranked from highest to lowest returns year-to-date) included: Marathon Digital Holdings MicroStrategy PayPal Nvidia Tesla JPMorgan Chase Visa BNY Mellon Facebook Coinbase "On average, these stocks have outperformed the S & P 500 by 34 percentage points YTD (+46% vs. +12%) alongside an 86% rise in the price of Bitcoin and a 156% rally in the Bloomberg Galaxy Crypto Index," Goldman's analysts wrote. "An equal-weighted portfolio of the stocks has demonstrated roughly 60% correlations with Bitcoin and the Bloomberg Galaxy Crypto Index during the last several months, compared with 20% correlations for the S & P 500," they added. A number of the companies Goldman highlighted have made announcements related to bitcoin and cryptocurrencies of late. In February, Tesla announced it had bought $1.5 billion worth of bitcoin — the value of its holdings has since risen to almost $2.5 billion — while last year, PayPal introduced a new feature letting its users buy, hold and sell cryptocurrencies. Meanwhile, Coinbase went public in a blockbuster direct listing that many crypto enthusiasts viewed as a "watershed" moment for the industry. Investment manager Cathie Wood's Ark Invest has been loading up on Coinbase shares through various funds.

Tesla, led by Elon Musk, confirmed that it purchased about $ 1.5 billion in bitcoin in January and expects to start accepting it as a payment in the future.

Artur Widak | NurPhoto | Getty Images

As bitcoin and other digital currencies surge in price, investors are looking for other ways to play the crypto craze.

Bitcoin is up over 90% since the start of 2021, even after a recent slide in prices saw the market shed more than $200 billion in value. Ether, the second-largest digital coin by market value, has climbed almost 350% year-to-date.

In a note published Thursday, analysts at Goldman Sachs named a list of stocks that are bouncing alongside bitcoin. The bank found that, on average, these stocks have significantly outperformed the S&P 500 this year.