Share prices of Thai listed companies with investment in Bitcoin rose after the cryptocurrency rebounded to a three-month high on hopes of wider acceptance as a payment method.
Prices of many cryptocurrencies continued to rise since the end of July, especially Bitcoin, which reached a three-month high of US$45,685 on Aug 10, up about 10% from the beginning of the month.
Paradorn Tiaranapramot, assistant vice-president of Asia Plus Securities (ASPS), said a supporting factor driving the prices of cryptocurrencies is the prospective greater adoption of digital currencies as a payment method by major companies.
Tesla Inc may resume accepting Bitcoin payments if its mining becomes more eco-friendly, while Amazon is expected to accept Bitcoin as a payment method within the second half of this year.
Bitcoin has been helped by the US Securities and Exchange Commission's signal it would approve a Bitcoin exchange-traded fund on the stock exchange, prompting the market to expect capital inflows to Bitcoin.
Mr Paradorn said Thai listed companies that are involved in cryptocurrencies can be categorised into four groups.
The first group consists of companies that have direct investment in cryptocurrencies such as Brooker Group (BROOK), whose earnings tend to move following Bitcoin price trends.
The second group consists of companies that invest in Bitcoin mining, such as Jasmine Telecom Systems (JTS).
The third group comprises companies that receive cryptocurrencies or digital tokens in exchange for goods or services, such as Sansiri, Ananda Development, Origin Property, AssetWise and Major Cineplex Group.
The last group comprises companies that offer services as initial coin offering (ICO) portals or token providers that act like a financial adviser or provide due diligence to verify information regarding an ICO issuance and maintain investor assets, such as Kasikornbank, Siam Commercial Bank, Xspring Capital (XPG) and JTS.
ASPS estimates the prices of cryptocurrencies will continue a rising trend and remain attractive, similar to the hemp trend.
Companies with direct investment in Bitcoin such as BROOK, JTS and XPG will benefit directly from the uptrend in the short term, he said.
However, investors should be cautious when investing in JTS and XPG as the two stocks have currently have very high price-to-earnings (P/E) ratios of more than 700 times, said ASPS.