It may not be too late if you missed out on bitcoin's rally. Bank of America Global Research analysts picked 12 stocks to buy if investors want a slice of the more than $2 trillion crypto pie that's "too large to ignore." "We believe crypto-based digital assets could form an entirely new asset class," analysts at the bank said in a note last week. Look beyond bitcoin The digital asset ecosystem is "so much more" than bitcoin, Bank of America analysts said. Bitcoin has a market capitalization of more than $1 trillion, data from CoinMarketCap showed. In the first half of 2021 alone, venture capital investments in digital assets and blockchain exceeded $17 billion. "This creates a new generation of companies for digital assets trading, offerings and new applications across industries, including finance, supply chain, gaming and social media. And yet we're still in the early innings," they said. Still, they warned of regulatory uncertainty as a near-term risk. Here are 12 stocks that the Bank of America has a "buy" rating on — because they are exposed to the cryptocurrency space. The bank expects to see returns of at least 10% in the 12 months from the initial rating. 1. Financials Digital wallet PayPal is a "must own stock," the analysts said. "We view [Paypal] as a scarce asset with accelerating structural tailwinds, while the company is well on its way to transforming its digital wallet/app into a financial 'Super App' for its massive global consumer base." Some big banks were also on the buy list. JPMorgan Chase created the first U.S. bank backed cryptocurrency in 2019 , while Morgan Stanley allowed access to bitcoin funds for its wealth management clients earlier this year, they explained. 2. Media The analysts also cast a spotlight on media companies that have stepped into the non-fungible token (NFT) space. They include Fox Corporation , iHeartMedia , Disney and Warner Music Group . NFTs, which took the art world by storm earlier this year, are digital assets designed to show someone has ownership of a unique virtual item. "The combination of content, contracts with rights and the exchange of value in a transparent form that allows participants and owners of those rights to share in the value accretion of future sales, has many potential implications for media participants and companies," the Bank of America analysts said. 3. Energy Utilities companies, particularly those in the nuclear power space are also set to benefit from a push for digital asset mining using low and zero-carbon energy sources. Nuclear energy offers these attributes and has the required reliability and ability to run round-the-clock, the analysts said. Stocks set to benefit include nuclear electric power generators Exelon , NRG Energy and Vistra , the analysts said. 4. Data centers There's a massive bitcoin mining exodus from China, which formerly accounted for more than half of the world's miners. Beijing's crackdown on digital asset mining has pushed many miners to look into migrating to places like Texas and New York in the U.S. "As digital asset mining migrates to North America due to China's near complete ban of mining activities, public data-center companies could view this niche market as an opportunity," the analysts said. China's state planner recently released a document adding cryptocurrency mining to a draft list of sectors where investment is restricted or prohibited . Data centers are physical rooms or buildings that house IT and computing equipment — like mainframes, servers and databases — needed to power everything from working from home to online shopping. Digital Realty is the largest wholesale data center operator and is "best positioned" to capitalize on that opportunity, the BofA report said. Equinix is another potential beneficiary. "Greater focus on the energy consumption of digital asset mining could increase demand for data center operators with greater renewable energy sources," the analysts said. "Equinix data centers are powered with 37% renewable energy with a target of 100% over the next decade."
A truck parked outside of Christie's auction house displays a CryptoPunk digital art non-fungible token (NFT) on electronic billboards on May 11, 2021 in New York City.
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It may not be too late if you missed out on bitcoin's rally. Bank of America Global Research analysts picked 12 stocks to buy if investors want a slice of the more than $2 trillion crypto pie that's "too large to ignore."