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3 Unstoppable Stocks That Can Outpace Bitcoin in 2021

Investors were taken on a historic ride last year. With the benchmark S&P 500 gaining 16%, most investors ended the year in the green. Yet, they also endured the quickest bear market decline of at least 30% on record, as well as the swiftest snap-back rally in history.

One asset has hardly blinked at the adversity.

Bitcoin has soared, but it’s a flawed investment

Over the trailing year, bitcoin — the largest cryptocurrency in the world — has quadrupled in value. Enthusiasts point to bitcoin’s scarcity and utility as reasons for its outperformance.

Bitcoin is limited to a lifetime circulation of 21 million tokens. Currently nearing 18.6 million, it will take until the year 2140 before all bitcoin tokens have been mined. Considering that the U.S. central bank continues to grow the outstanding money supply, Bitcoin is perceived to be a haven against dollar deflation.

Bitcoin has also been seeing increased usage as a medium of exchange. More than 5,000 bitcoin ATMs have been placed worldwide, with over 15,100 businesses (2,300 in the U.S.) now accepting bitcoin as a form of payment., according to Fundera.

Yet, bitcoin is also full of flaws. For example, scarcity and utility are at odds with one another and not complementary. Even with bitcoin divisible down to eight decimal places, there simply aren’t enough tokens to make it a viable replacement for fiat currencies — especially with a lot of tokens held by investors with no intention of putting them into circulation. If bitcoin wants full-scale utility, consensus will need to be reached to increase the token count.

It could even be argued that bitcoin isn’t truly scarce at all. While it has a perceived cap of 21 million tokens, this limit exists only on consensus. There’s nothing concrete about bitcoin’s cap.

These innovative companies can run circles around bitcoin in 2021

I believe other investments could handily outpace bitcoin in 2021. If you’re looking to avoid bitcoin’s nauseating volatility and buy a handful of great companies, these are the three unstoppable stocks to consider adding.

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