Benchmark Crypto Indices Weekly Performance Review — April 28

Over the past 7 days, the FS CryptoFX Agg Index increased by 6.9%, compared with a 1.3% decrease for the S&P 500 (Slide 6). Although finishing the week 6.8% higher, Bitcoin trailed the Mid-caps and Small-caps by 3.2% and 0.1%, respectively.

Benchmark Crypto Indices Weekly Performance Review — April 28

Sector Performances

FS CryptoFX Platform index once again posted the best performance among all FS crypto indices. All constituents within the Platform index have been up over the past week – The biggest contributors were Cardano (+28%), Stellar (+27%), Tezos (+22%) and Ethereum (+9%).

Benchmark Crypto Indices Weekly Performance Review — April 28

FS CryptoFX Exchange index and Privacy index lagged over the past week – although Kyber Network and 0x surged 43% and 15%, respectively, the biggest token within the sector, Binance Coin (+2%), pulled down the overall performance of the index.

Benchmark Crypto Indices Weekly Performance Review — April 28

Within the Privacy sector, Horizen and Monero led, and were both up 7%. Zcash (-4%) has been the worst performing coin within the Top 50 cryptocurrencies. Primarily due to that, FS CryptoFX Privacy index trailed Bitcoin last week by 3.4%.

Benchmark Crypto Indices Weekly Performance Review — April 28

China launches state blockchain infrastructure
China was not kidding when it said it wanted to become the world leader in blockchain technology. Last Monday, the People’s Bank of China (“PBoC”) confirmed that was piloting its Central Bank Digital Currency (“CBDC”). Last weekend, the Chinese government announced that it is launching its more all-encompassing Blockchain Services Network (“BSN”).

Nicknamed ‘ChinaChain’, China’s BSN aims to provide a one-stop-shop blockchain environment where information can flow freely between different infrastructures. Think of it as a “plug and play” network whereby developers and their respective applications can tap into multiple different chains through the BSN network which adds value by providing cross-chain interconnectivity.

At the moment, the BSN supports a number of permissioned blockchains including a modified version of the Hyperledger Fabric blockchain with “special encryption algorithms.” Most surprisingly, the network also claims to support permission-less networks, EOS and Ethereum, though what this will actually look like in practice is still highly uncertain. In other words, don’t expect to be able to use BSN to tap into a truly public blockchain.

Like it or not, there is a new kid on the block. Sate spearheaded “blockchain” technologies such as CBDCs and China’s blockchain services network are coming to market. While these technologies promise similar cost efficiencies compared to public blockchains, they do not come with the benefits of censorship resistance, immutability, and increased levels privacy. In almost all instances, they will come with the promise of increased surveillance and could ultimately strengthen the case for public DLTs that prioritize privacy.

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