Three blockchain or crypto stocks for dividends
This concept of earning dividends from a digital currency may be new, but there are also ways to earn passive income through dividends from companies making use of blockchain technology. Here are three to consider:
1. CME Group
CME Group (NASDAQ:CME) is one of the world’s largest exchanges for financial instruments. It’s best-known for options, futures, and other derivatives contracts on a diverse mix of things from basic agricultural goods to stock indexes to currencies and interest rates. In 2017, CME announced an exchange for options on Bitcoin, and, in early 2020, it expanded to futures contracts on Bitcoin. Most recently, it announced that futures on Ether (the token on the Ethereum network) would be available starting in February 2021 — bringing risk-management tools to the world’s most recognizable cryptocurrencies.
Besides giving you an ownership stake in a leading global financial assets exchange (one with a history of slow and steady growth since market trading volume averages higher over time), CME stock also pays out a dividend. As of this writing, the company pays $0.85 per share each quarter, good for an annual dividend yield of 1.8%. And, from 2011 to 2020, the quarterly payout increased more than 200%, not including a number of special one-time payouts to shareholders, including a special $3.25-per-share payout in January.
2. Mastercard
Mastercard (NYSE:MA) needs little introduction since it makes up a virtual duopoly with rival Visa (NYSE:V) in handling the global digital payments industry. Since Mastercard specializes in digital transactions, cryptocurrency is a natural fit. And, as the use of digital currency has risen, so has the payment company’s investment in new projects. In 2019, it announced a partnership with blockchain software firm R3 to develop a new cross-border transaction system. It has also begun partnering with crypto firms to allow the issuing of debit and other payment cards, allowing users to convert their cryptocurrency holdings into a fiat currency (issued by a government) to make purchases.
This stock also pays a dividend, which was $0.40 per quarter as of mid-January (an annual yield of 0.5%). It may not look like much, but the payout was a lowly $0.015 per share each quarter back in 2011 (adjusted for a 10-for-1 stock split in 2014). Additionally, Mastercard rewards shareholders by repurchasing its stock. In December 2020, it authorized a $6 billion buyback program, worth about 1.8% of Mastercard’s market cap as of this writing. With digital payments only increasing in importance, Mastercard remains a viable means of betting on a digital future.
