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  5. DEFI: What are the leading blockchain ETFs or companies? [A]
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Q: What are the leading blockchain ETFs or companies? I'm more interested in focusing on the blockchain technology and blockchain applications used by numerous industries (financial, shipping, government, etc.) rather than focusing on any specific cryptocurrency like Bitcoin. Thanks.
Asked by Ed on February 14, 2024
5i Research Answer:

For application-specific blockchains, most activity is currently happening on the Ethereum and Solana networks, which are both layer 1 crypto's. Historically, there have been uses with 'private blockchains' operated by companies and entities, but these are less efficient than public, decentralized blockchains (layer 1 crypto networks) like ETH and Solana. 

Many of these applications for finance, shipping, government, etc. will be built on public technologies like ETH and others, and this causes value to accrue back to the layer 1 networks, ETH, etc. 

For publicly traded exposure, GLXY and COIN both have exposure to trading, private investments, in applications for finance, shipping, and more, but they also have exposure to other markets as well (bitcoin mining). DEFI has some exposure to finance and blockchains, but it is quite small and has lots of volatility. 

Overall, private blockhains are mostly happening at the company level (IBM, JPM, etc.), but most activity with blockchain technology will be built on cryptocurrencies. An analogy is private enterprise internet from the 90s vs. public, decentralized internet. 

Most 'blockchain' ETFs hold a significant amount of bitcoin miners, which does not include practical applications like shipping or decentralized finance. There are several ETH ETFs which provide investors exposure to Ethereum, and while activity for government entities and shipping and logistics is currently small, ETH can be thought of as an open network where developers can built multiple applications on top of. Currently there is a lot of decentralized finance activity on top of ETH.

Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in COIN.