Oct 24
This guide provides advisors with a source of truth on the largest cryptocurrencies and digital assets. We included "Soundbites" as bite-sized insights to equip advisors with concise talking points to share with clients.
Blockchain technology is continually evolving, with new cryptocurrencies and digital asset projects being launched every week. It can be hard to keep up, and even harder to parse through the esoteric language and understand what each digital asset project and company actually does.
We created the below guide to provide advisors with an easy-to-understand source of truth on the largest cryptocurrencies and digital assets. We've included "Soundbites" as bite-sized insights to equip advisors with concise talking points to share with clients.
If you don't see an asset covered below that you would like added, reach out to oathiq@oathdigital.io and we will add it to the guide.
Description: ETH is the first, largest, and most important smart contract platform. It maintains the strongest community of developers, users and unique applications.
Soundbite: The ETH token acts as an “index” of all the applications and infrastructure built on top of the Ethereum network. The token has a clear value capture mechanism as as adoption and network usage increases. ETH is one of the most attractive entry points for large institutions looking to own liquid digital assets.
Description: Native token of Binance exchange and Binance Smart Chain (Binance smart contract platform). Binance is the largest centralized exchange by volume.
Soundbite: BNB provides exposure to the Binance ecosystem -- both the largest centralized exchange (Binance) and one of the largest smart contract platforms (BNB chain). Binance continues to excel as the leading global exchange and developer of blockchain-enabled financial products.
Description: Solana is a smart contract platform known for fast, low-cost transactions. Solana rose to prominence in 2021 as an alternative to Ethereum as the network experienced high-fees and slow transactions due to high transaction volume.
Soundbite: Solana is a viable competitor to Ethereum, and has attracted a strong community of developers and users across DeFi and NFTs. Solana however has struggled with performance issues, and the chain has experienced several outages over the last year.
Description: Polygon is a platform that helps the Ethereum ecosystem scale through layer-2 and other scaling solutions. The MATIC token is used as the native token in the Polygon side-chain, which leverages Ethereum’s security model but allows for faster and cheaper transactions.
Soundbite: Polygon has the most talented business development team in the blockchain industry, signing marquee deals with Starbucks, Reddit, Instagram, Stripe and Adidas. While Polygon’s ETH scaling solution was first to market, there is significant competition from other L2s such as Arbitrum, Optimism, zksync and Starknet.
Description: Polkadot is a “layer-0” smart contract platform which powers a network of blockchains (called “parachains”) to operate on its foundational layer. This is a notably different blockchain design than Ethereum’s single blockchain design.
Soundbite: While innovative in design and technology, the Polkadot ecosystem has struggled to attract users and TVL. The parachain system is more expensive and complex to deploy application-specific blockchains than Cosmos’s “internet of blockchain” system.
Description: Cosmos is a "layer-0" smart contract platform that has built "the internet of blockchains" -- an interconnected ecosystem of layer-1 blockchains. Cosmos makes it easy for applications to deploy their own application-specific blockchains, creating "appchains".
Soundbite: Cosmos has strong technology, a strong team and has become a preferred choice for applications looking to build their own blockchain. However, the ATOM token has not been able to accrue value as the Cosmos ecosystem will grow. It is possible that one of the Layer-1 blockchains built on Cosmos surpasses ATOM in market value.
Description: Bitcoin is a peer-to-peer electronic cash system created by an anonymous developer in 2009. It is the first and largest blockchain and cryptocurrency.
Soundbite: We view Bitcoin's long-term vision as becoming the de-facto non-sovereign store of value for our increasingly digital society, eventually reaching and surpassing Gold. Bitcoin will likely remain the largest and most important cryptocurrency, however, we expect smart contract platforms and other tech-focused blockchains to surpass in market cap and importance over time.
Description: Dogecoin is a peer-to-peer digital currency founded in 2013. Initially founded as a “joke” by its creators, DOGE is one of the largest digital assets by market cap.
Soundbite: Dogecoin has many similarities with Bitcoin, as both are digital stores of value supported by passionate communities. While it is easy to dismiss DOGE, it is the only digital asset other than BTC to make new highs across the last three cycles (2014, 2017, 2021).
Description: SHIB is a peer-to-peer cryptocurrency similar to DOGE. SHIB generated the highest returns of any digital asset in 2021: $100 invested in November 2020 would have been worth $152mm in October 2021, and ~$18mm today.
Soundbite: While Shiba Inu started as a meme token, an ecosystem of applications is being built on the SHIB network, with its own decentralized exchange and other applications.
Description: USDT is the largest stablecoin pegged to value of 1 USD. Maintains peg through 100% 1-1 backing with fiat currencies and reserves. Available on most smart contract platforms.
Soundbite: Critics have voiced concerns over the legitimacy of the 1-1 backing throughout Tether’s history, however there has never been any substantive proof that it is not backed. However, we’d rather keep our capital on other stablecoin such as USDC or BUSD as there is no upside inholding USDT vs. slightly more reputable alternatives.
Description: Stablecoin that is 100% 1-1 backed with cash and short-dated treasuries. USDC reserves are held in the custody and management of leading U.S. financial institutions, including BlackRock and BNY Mellon.
Soundbite: USDC was the first stablecoin supported by Coinbase in 2018, and seems to be the preferred stablecoin by many US-based institutional investors.
Description: Binance-branded stablecoin issued by Paxos, and backed 100%by reserves held in fiat cash or U.S. Treasury bills.
Soundbite: BUSD has quickly grown as one of the largest stablecoins as the Binance centralized exchange has implemented it as the preferred stablecoin on the Binance exchange.
Category: Payments
Description: Cross-boarder payment network which rose to prominence in the 2017 bull market cycle. Ripple was sued by the SEC in December 2020 for selling unregistered securities.
Soundbite: Despite being a top-10 token by market cap, Ripple’s core product, a blockchain-based global payment network, has been supplanted by stablecoins such as USDT and USDC as the leading blockchain-based payment networks.
Category: Smart Contract Platform
Description: Cardano is a smart contract platform founded in 2015 by Ethereum co-founder Charles Hoskinson. Smart contracts and applications were launched in September 2021.
Soundbite: Despite a $16bn market cap, Cardano only has ~$60mm of total value locked in smart contracts on the platform. Charles Hoskinson maintains a popular YouTube channel, which makes Cardano one of the first digital assets retail investors hear about. We view Cardano more as a retail-driven memecoin than a smart contract platform.
Oath Digital, Inc. All content is original and has been researched and produced by Oath Digital, Inc (“Oath Digital”) unless otherwise stated herein. This report is for informational purposes only and does not constitute an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal. There is not enough information contained in this report to make an investment decision and any information contained herein should not be used as a basis for this purpose. This report does not constitute a recommendation or take into account the particular investment objectives, financial situations, or needs of investors. Investors are not to construe the contents of this report as legal, tax or investment advice, and should consult their own advisors concerning an investment in digital assets. The price and value of assets referred to in this research and the income from them may fluctuate. Past performance is not indicative of the future performance of any assets referred to herein. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments.
Certain of the statements contained herein may be statements of future expectations and other forward-looking statements that are based on Oath’s views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. In addition to statements that are forward-looking by reason of context, the words “may, will, should, could, can, expects, plans, intends, anticipates, believes, estimates, predicts, potential, projected, or continue” and similar expressions identify forward-looking statements. Oath assumes no obligation to update any forward-looking statements contained herein and you should not place undue reliance on such statements, which speak only as of the date hereof. Although Oath has taken reasonable care to ensure that the information contained herein is accurate, no representation or warranty (including liability towards third parties), expressed or implied, is made by Oath as to its accuracy, reliability or completeness. You should not make any investment decisions based on these estimates and forward-looking statements.
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