Goldman’s Crypto Report Shows Exchange Tokens, Proof of Stake Outperforms

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Exchange tokens and digital assets associated with proof-of-stake blockchain networks have outperformed the broader cryptocurrency market since late 2019, while privacy-focused digital tokens have underperformed, wrote Goldman Sachs in a new report.

As the market matures, monitoring crypto market segments can help determine what network features investors are rewarding, as well as the prospect of practical applications of the technologies, Zach Pandl, co-head of strategy, wrote on Wednesday. of Goldman, and analyst Isabella Rosenberg. in the report.

The report’s release represents the latest iteration of the Wall Street firm’s intermittent flirtation with cryptocurrencies. As recently as June, a division of Goldman called digital assets unsustainable for client portfolios, but analysts at the company continue to respond to institutional investors with in-depth reviews.

Exchange tokens are digital tokens issued by crypto exchanges, such as the binance coin, while currency type assets are represented by bitcoin (BTC). The report classified the chain link (LINK) as a token used in other applications and the monero (XMR) as a privacy coin.

Transfer tokens such as xrp (XRP) outperformed the crypto market last November, while decentralized finance-related assets such as uniswap (UNI) gained momentum in January and early February, notes the report.

Meanwhile, tokens associated with proof of stake networks have outperformed proof of work tokens since late 2019, according to the report.

Cryptocurrencies are a very heavy market compared to other asset classes, the report notes. Bitcoin represents 46% of the cryptocurrency market and ether 20%, according to the Wall Street firm. In comparison, the two largest stocks in the S&P 500 Index represent about 12% of market capitalization, according to the report.

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