When Will Interest In Synthetic Assets Pick Up?

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CryptoMode ASX Blockchain Delay Synthetic Assets

The cryptocurrency industry creates various investment opportunities for speculators and enthusiasts. Synthetic assets are often an interesting choice, even if their overall trading volume is not necessarily that great. The CoinGecko rankings confirm the main synthetics are tied to existing crypto assets rather than anything else. 

Crypto-based Synthetic Assets Reign Supreme

Blockchain technology and token standards theoretically allow any asset to be tokenized as a synthetic counterpart. That applies to crypto-assets, currencies, precious metals, stocks, indices, and much more. Although various exchanges and platforms offer a variety of synthetic assets today, the ones tracked on CoinGecko paint a rather interesting picture. 

However, there is a crucial difference between tokenized stocks and indices and synthetic assets. The ones tracked by CoinGecko confirm the main interest lies in synthesizing cryptocurrencies and fiat currencies rather than anything else. Both options make sense, as they can bring more liquidity to the broader industry and help unlock additional use cases without unnecessary token conversions. 

Source: CoinGecko

The current landscape depicts a strong interest in sEth and sBTC. As these are synthetic assets representing the two largest cryptocurrencies, it is somewhat normal to see them high up the rankings. Other crypto assets include sLINK, sADA, sRUNE, and sDOT. However, those latter three have under $50 million in market cap and a near non-existing trading volume. 

Things look a bit better for sEth and sBTC. They have a market cap of $329 million and $236 million, respectively. It is intriguing to see a higher cap for sEth than sBTC when the underlying assets hold opposite positions. However, a synthetic asset tied to Ethereum might pose more opportunities than one tied to Bitcoin these days. As no other synthesized crypto asset comes close to this level of performance, there is still much room for competition. The overall market cap is jut below $840 million, with barely $6 million in trading volume. 

What About Synthetic Fiat Currencies?

Contrary to what one may think, synthetic assets tied to fiat currencies do not fare that well. The sEUR is the most prominent one on CoinGecko, with almost $111 million in market cap. sUSD, the obvious counterpart, has a market cap of $100.5 million, indicating somewhat equal demand for exposure to these two currencies. However, there are other currencies to explore.

Source: CoinGecko

Assets such as sAUD paint an interesting picture. Although not much is known about the popularity of cryptocurrency in Australia, there is enough reason to dedicate one of the synthetic assets to the Australian Dollar. Its market cap of $13.5 million is not too impressive, yet it confirms there may be more demand for synthetic fiat currencies in the future. 


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