A new report by Goldman Sachs shows that crypto currencies, such as Bitcoin, are no longer the top performing segment of the crypto market.
Since 2019, coins that are primarily used as currencies have been narrowly outperformed by exchange tokens, like Binance Coin, which allow users to pay fees on online exchanges.
The report found that the Crypto market has delivered average returns of 750 per cent since the end of 2019. Bitcoin has underperformed relative to this benchmark, gaining around 500 per cent, while Ethereum, classed as a digital platform, saw returns of 2000 per cent.
Privacy coins, such as Monero, which anonymise data about their users were amongst the worst performers relative to the market as a whole. The data also revealed that returns from coins which use Proof of Stake consensus saw double the returns of those based on Proof of Work.
Zach Pandl and Isabella Rosenberg, who authored the Goldman Sachs report, said: “Today, many of the most prominent assets in the marketplace have little to do with Bitcoin’s original aspiration as a peer-to-peer electronic cash system, or its de facto role as a “store of value” asset akin to gold.”
While interest in alternative uses for crypto assets is growing, the report also noted that the market remains “top-heavy” with Bitcoin and Ethereum accounting for 66 per cent of market cap. By contrast, the two largest stocks in the S&P 500 collectively account for 12 per cent.
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