Interest in cryptocurrencies has increased among institutional investors in recent months as inflation has climbed and the appeal of popular currencies as a safe haven and store of wealth in volatile markets has soared. Global crypto investors realized a total gain of $162.7 billion in 2021, up from $35.5 billion the previous year, cryptographic messaging firm Chainalysis disclosed in an April 20 report. The United States led the pack with more than $47 billion, followed by The United Kingdom, Germany and Japan.
One interesting thing highlighted in the report is that countries that don't rank high in traditional measures of economic prosperity like GDP often do well in cryptography, which could be a stark reminder of the capabilities of revolutionary blockchain technology. For example, Turkey, which ranks 11th in the world in TERMS of GDP, ranks sixth with $4.6 billion in cryptocurrency revenue. Ukraine ranks 40th in GDP, but 13th in cryptocurrency realized revenue, at $2.8 billion.
The report also discusses in detail the development of cryptocurrency in China, which is one of the largest cryptocurrency markets in the world. In 2021, China's estimated total realized cryptocurrency revenue was $5.1 billion, up from $1.7 billion in 2020. China regulates blockchain technology, but the annual growth rate is 194%, slower than other cryptocurrency countries such as the US (476%), the UK (431%) and Germany (423%).
Emerging trends: Ethereum edge Bitcoin, NFTs explosion
Another emerging theme in crypto is the performance of Ethereum, the second most popular currency, It has gained mainstream recognition through the efforts of companies such as Mastercard(NYSE :MA), PayPal Holdings, Inc.(NASDAQ :PYPL) and Block, Inc.(NYSE :SQ). According to Chainalysis, ethereum's total realized revenue globally was $76.3 billion, compared with bitcoin's $74.7 billion. Some experts have previously predicted that Ethereum is a better long-term investment than Bitcoin.
For example, tallygreenberg, head of business development at crypto firm Allnodes, argues that "the technical advantages and utility of the ethereum blockchain are far greater than bitcoin". Megan Kaspar, managing director of asset management firm Magnetic, predicts institutional investors will turn to Ethereum as the importance of new updates to the network becomes apparent, including a shift to greener mining options.
The market for irreplaceable tokens is also exploding in the crypto space. NFTs are just one way blockchain technology is reshaping the world around us. NFT is a non-interchangeable unit of data stored on a blockchain, a form of digital ledger, that can be sold and traded. Some examples include photos, video, and audio in digital form. Nonfungible recently released a report noting that NFTs transactions climbed to nearly $18 billion last year, up 21,000 percent from 2020.
This article provides the reader with some background on investment choices through a careful assessment of business fundamentals, with companies operating in the crypto space selected for the list. This paper also discusses the growth catalysts for these enterprises to paint a more comprehensive picture.
The largest crypto company in the world
10. Chainalysis
Chainalysis is a software company that provides blockchain data and analytics to governments, banks and businesses around the world. One of the company's main products is compliance, regulatory and investigative software related to blockchain technology. The software can detect and prevent various illegal activities, such as money laundering. This is a key competitive advantage for the company, as hackers and related privacy concerns surrounding blockchain technology are casting a shadow over the industry's future development.
One statistic that highlights this competitive advantage is the number of customers for the Chainalysis service. Chainalysis software is used by nearly 650 institutions, including crypto exchanges, leading banks, payment processors, hedge funds and venture capital firms. The company recently launched Cross Chain Investigations to Reactor, a tool that helps customers track cryptocurrencies and related digital assets on the blockchain. Last June, the company raised more than $100 million in a Series C funding round at a valuation of more than $4 billion.
Like mastercard Inc. (NYSE:MA), PayPal Holdings, Inc. (NASDAQ:PYPL) and Block, Inc. (NYSE:SQ), as the risk/reward profile in growth areas improves, Chainalysis is one of the cryptocurrency companies that elite investors are piling into.
9. Uniswap
Uniswap is a cryptocurrency exchange that embraces transparency at the heart of the blockchain revolution. The exchange is used on a blockchain network that runs open source software. This is in stark contrast to other crypto exchanges that run on centralized servers. More and more developers, traders and liquidity providers are using the platform's capabilities. Each company to date has generated more than $935 billion in transactions and more than 95 million transactions. By the end of 2021, the platform had more than 3 million users.
Uniswap has the highest market share among decentralized cryptocurrency exchanges, with nearly a quarter of all transactions. It also has the highest daily trading volume of the group. On Uniswap, transactions are executed on the chain, but there is no central authority to facilitate these transactions. Instead, users are free to interact with other users through a secure system and make transactions directly through their encrypted wallets. These transactions are transparent and open source, reducing the potential for money laundering.
8. Kraken
Kraken is a cryptocurrency exchange and bank. The company was founded in 2011 and is based in California. The exchange already operates in more than 60 countries. It also recently received a license to operate in the United Arab Emirates. The Middle East is one of the fastest growing cryptocurrency markets. Chainalysis estimates that nearly 7% of global cryptocurrency transactions originate in the region. Kraken was the first company to offer uae dirhams directly traded with bitcoin. The UAE trades around $25 billion worth of cryptocurrencies every year.
Kraken is the fourth-largest exchange in the world in terms of trading volume. More than 6 million users conduct crypto transactions on the platform. These users are in 190 countries. Jesse Powell, the company's chief executive, had previously said the exchange could go public by the end of 2022. The company is valued at nearly $20 billion. The exchange trades hundreds of millions of dollars a day. In January last year, at the height of the cryptocurrency boom, the exchange completed $56 billion worth of transactions, more than in all of 2019.
7. Sandbox
The Sandbox is a meta-cosmic platform. The platform began as a game that could be played on computers and mobile phones, with a "play to earn" model. The blockchain-based version of Sandbox allows users to create their own avatars, as well as trade, to access different types of environments and games in the meta-universe. The platform is the largest in the crypto space, with more than 2 million users. These users can also conduct virtual real estate transactions within the yuan world.
In 2021, total land sales on Sandbox exceeded $350 million. Nearly 80 percent of that happened in the last quarter of 2021. During the period, sales of second-hand homes increased by more than 1.600% year-on-year. The number of active buyers on the platform grew in each of the four quarters of 2021, rising 37% between October and December. Sandbox's median land price was $1,308 at the end of the third quarter, but jumped to $11,364 by the end of the year.
6. OpenSea
OpenSea is a marketplace for irreplaceable tokens. As of early 2022, the platform had more than 600,000 users. That's a huge increase from March 2020, when there were just 4,000 users on the platform. OpenSea's monthly traffic is even more impressive. According to conservative estimates, the site receives more than 120 million visits a month. This puts it well ahead of the competition in NFT's markets division. In 2021, the company generated more than $365 million in NFT sales on the Ethereum blockchain.
In 2020, OpenSea generated just $525,000 in revenue. This difference highlights the amazing growth NFTs has made in encryption. The marketplace charges a 2.5 percent fee for each transaction on the platform. This is similar to what competitors such as Rarible charge. The company is estimated to be worth more than $13bn. So far, the company has raised more than $427 million in nine rounds of funding. Of that, $300 million came from a Series C round in early 2022.
In addition to mastercard (NYSE:MA), paypal Holdings (NASDAQ:PYPL) and Block, Inc. (NYSE:SQ), OpenSea is one of the companies that institutional investors are looking at.
5. Grayscale
Grayscale is a digital currency investment service. Some of the services it offers include market information, investment exposure and investment products related to the developing digital currency asset class. The company offers some of the world's largest publicly traded cryptocurrency funds. These include the grayscale Bitcoin Trust and the grayscale Ethereum Trust. Together, these companies have a market capitalization of more than $11 billion. Grayscale offers nearly 20 publicly traded investment products for cryptocurrencies.
Michael Sonnenshein, Grayscale's chief executive, said at a crypto conference in November that new businesses in the digital world were converging around games, virtual reality in social media networks and other quasi-meta-worlds. The comments suggest that the company may also start offering Yuanworld's investment products in the near future. Grayscale sees the metasverse as a trillion-dollar market opportunity. Metaverse revenue could grow to more than $400 billion by 2025, the company estimates.
4. Binance
Binance is the world's largest cryptocurrency exchange by daily trading volume. The exchange offers cryptocurrency trading across cash, derivatives and DEFI markets. The exchange has more than 30 million users. In 2017, when it launched, it had only about 120,000 users. Binance's website and app are visited by nearly 29 million people every week. With nearly $10 billion in daily transactions, the app is the largest in the world. Bloomberg estimates the company's 2021 revenue to be more than $20 billion.
Binance posted these incredible numbers despite the fact that it is banned in popular crypto regions like China, the UK and Singapore. The company plans to go public in 2024 with a target valuation of about $300bn. Coinbase, Binance's closest competitor, has a market cap of just $40 billion. Binance has been the world's largest cryptocurrency exchange since 2018. In addition to Turkey, other countries with high traffic on coins include Russia and Brazil.
3. International Business Machines (NYSE:IBM)
International Business Machines Corporation (NYSE:IBM) provides solutions and services related to information and technology. Over the past few years, the company has invested heavily in new technologies like cloud computing, artificial intelligence and blockchain. In artificial intelligence software, it controls nearly 14 per cent of the market. One of the company's competitive advantages over its peers in the market is that it has a large revenue stream from established businesses, which helps fund growth plans.
IBM provides enterprise blockchain solutions and services. The company has partnered with Ripple like blockchain Stellar and startup Stronghold to launch bank-backed stablecoin USD Anchor. Some of the company's offerings in the crypto space include supply chain solutions, identity management and digital asset management. Hedge funds are also bullish on IBM. Arrowstreet Capital is the company's major shareholder with a stake worth $440 million.
2. Twitter Inc . (NYSE: TWTR)
Twitter, Inc.(NYSE:TWTR) is a microblogging and social networking platform. The company is the second most popular social media platform in the world, with a market share of more than 7% in the sector. Twitter was recently acquired by billionaire Elon Musk for $44 billion. Some of the competitive advantages the company offers over its peers include a real-time news feed, a more diverse audience, and relative freedom from advertising. The company has more than 200 million daily active users.
Twitter has a separate business unit, Called Twitter Crypto, dedicated to developing the encryption side of the web. Twitter is also involved in the development of blockchain technology, which caters to decentralized social networks. Last year, the company launched a feature that allows users to tip other users on the platform by paying Bitcoin via Lightning. Retail crypto bulls also have a strong presence on the Twitter platform.
1. Coinbase Global, Inc.(NASDAQ:COIN)
Coinbase Global, Inc.(NASDAQ:COIN) is a fintech platform that serves the crypto economy. It is one of the largest and most popular crypto exchanges in the world. The company has more than 89 million certified users, 11,000 institutions and 185,000 ecosystem partners in more than 100 countries. As one of the "first movers" in cryptography, the company has a competitive advantage. The company went public in April 2021 with a valuation of more than $85 billion, making it one of last year's biggest ipos.
Coinbase has beaten consensus earnings per share in three of the last four quarters. Margins on these beats are 152 per cent, 7 per cent and close to 50 per cent, respectively. The company's upcoming earnings call is scheduled for mid-May. In spite of the earnings performance, the share price continued to fall steadily amid a general downturn in corporate rights issuance amid rising inflation and interest rates. Hedge funds also invested in the company. A