Even as rumors swirl around Apple Inc (NASDAQ:AAPL) entering the growing electric vehicle market, an analyst at RBC Capital Markets is suggesting Cupertino has another, more lucrative opportunity.

Crypto A Better Bet For Apple? Apple should be following in the footsteps of Tesla Inc (NASDAQ:TSLA) and buying cryptocurrencies, rather than tackling EV manufacturing, analyst Mitch Steves said in a note, according to Bloomberg.

Tesla revealed in a 10-K filing Monday that it holds about $1.5 billion in reserves as Bitcoin and also plans to accept payments for sales in the digital currency on a limited basis.

If Apple were to develop the Apple Wallet into a crypto exchange, it could have a sizable new market opportunity in the billions, the RBC analyst said. 

Apple Wallet is a mobile app included with the iOS that allows users a convenient way to organize and use rewards cards, boarding passes, tickets, gift cards and more in one place.

Square Inc (NYSE:SQ), which is estimated to have an installed base of about 30 million users, generated about $1.6 billion per quarter from Bitcoin-related trading, Steves said.

Assuming only 200 million of Apple's installed user base of 1.5 billion trades, the market opportunity is about 6.66 times larger than Square, the analyst estimates.

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Security Is Apple's Sales Proposition: If Apple decides to enter the market, it can immediately gain share, Steves said.

The analyst noted that companies such as Paypal Holdings Inc (NASDAQ:PYPL) and Square as well as closely-held exchanges such as Coinbase have all validated the business model.

Apple can offer more secure transactions than the rest in the industry, the analyst said.

A Win-Win Proposition? Just as cryptocurrency could be a multibillion-dollar opportunity for Apple, more users using an Apple exchange could boost the price of Bitcoin, Steves said.

Bitcoin was trading at 14.39% higher at $43,993 at last check. 

Apple Park in Cupertino, California. Photo by Daniel Lu via Wikimedia.