Comparison of blockchain networks for ICO token issuance: 09/18

Lennart Ante
Sep 1, 2018 · 5 min read

When planning a token sale, projects need to closely evaluate which blockchain infrastructure provides the best fit for their product or service. In this article, I will try to provide an overview of the 27 most relevant blockchain infrastructures for ICO tokens. I will try to write an update of this post every month (and possibly add more variables). This way, actual developments and trends regarding token infrastructures can possibly be determined.

Potentially, I’ll be able to introduce a rating or scoring system in the future. At this time, the amount and quality of data is obviously not good enough to do so.

Market statistics

This article focuses on secondary markets, potentially providing a resource to projects that are looking to determine the right blockchain networks for their token/ICO. To sum it up, I personally believe that there are various different steps to determine the fitting infrastructure for a project (many more than the provided information). Secondary markets are one of the major benefits of tokenization, as “investors” gain instant liquidity. Therefore, the obvious choice for choosing a blockchain network that investors favor is the one that will ultimately lead to the highest liquidity.

Currently, that is definitely Ethereum, as it has the highest market capitalization, likely the most users, the highest trading volume, is listed on the most exchanges and has various DEXes.

Token statistics

Yet, the underlying token of the infrastructure does not need to have an influence on the actual trading volume or number of exchanges where the ICO token will be listed. Therefore, market and exchange statistics only offer a very first indicator for a fitting platform.

It can be seen that of the 27 different blockchain networks, Ethereum is omnipresent and only NEO also seems to have a relevant market impact. Comparatively older networks like Counterparty, Omni or Bitshares loose relevance, while “younger” projects like EOS or Cardano do not yet have a relevant market presence.

Based on the factor market capitalization and number of exchanges, it is likely that EOS, Stellar, Rootstock and (possibly) Cardano will gain relevant market shares on the token market. But it is still fully unclear how big this market share will be.

The network effect of Ethereum can be compared to Bitcoin, making it hard for new infrastructure providers to enter the market.

When looking at the “top token” of each blockchain, Tether on OMNI represents the biggest one. Yet, OMNI did not achieve to gain newer projects on their network but pretty much only exists for Tether and some “older” tokens, like MaidSafeCoin (MAID) or Synereo (AMP). While OMNI might look like a fitting choice for a token when only looking at this table, one must keep in mind that OMNI itself only has a market capitalization below $5 million and appears like a discontinued model (like Bitshares or Nxt too).

While Binance Coin is the “top” token on the Ethereum network, it is only traded on 22 different exchanges due to the fact that the coin is directly tied to the crypto-exchange Binance and could possibly be classified as a security (due to the buyback policy). The second biggest token on Ethereum, OmiseGo (OMG), is traded on 92 different exchanges. This shows that the overwhelming market presence of Ethereum still exists, the table might be misleading.

Tech statistics

Disclaimer: It is highly unlikely that all these numbers and languages are “true”. You also have to keep in mind that the theoretical amount of transactions per second is somehow a farce. If you find something that needs to be corrected, feel free to send me a mail.

When deciding on a token infrastructure, various technical (way more than shown here) variables are relevant. How will the token be used? If the token has a low transaction volume or even is a security without an actual “use”, scalability and block time might not be relevant. If the team can work with the programming languages, Ethereum may be the obvious infrastructure choice. Yet, projects should still closely evaluate all options. For example, Stellar offers a fiat gateway for token sales and Byteball provides a fully working ICO platform that can accept Bytes, BTC and ETH.

CryptoKitties was the perfect example that today’s blockchains 2.0 do not scale, i.e. the 15 transactions per second of Ethereum cannot handle various dApp approaches. Additionally, transaction costs represent a highly relevant factor for applications with high transaction volumes. Projects that use Directed Acyclic Graphs (DAGs), like Byteball, or semi-decentralized projects that use various specific forms of Proof-of-Stake (PoS) consensus, like EOS or NEO, can provide a fitting solutions for such projects.

Conclusion

The blockchain ecosystem is constantly growing and it will be very interesting to see which networks will be able to become relevant for tokenization. In this post I did not include projects like RChain or Tezos, as my goal is keep the list somewhat clear. I will try to always post information on the “top” 25–30 projects, based on the relevance of the networks. It is unclear when we will see the first (relevant) tokens on other networks. Time will tell.

In order to develop a scoring or rating mechanism, various additional variables need to be collected. The number of nodes that participate in the network consensus or the amount of live dApps are only two relevant variables. Actual transactions per second/minute, number of total transactions or transaction fees are also quite relevant for a suitable evaluation or comparison of networks.

Not-shown projects currently include: Tezos, RChain, Hashgraph, Wanchain, Ubiq, Aion, ThunderCore, Particl, Neblio, Tari, Peaq, Zilliqa and NULS. They may or may not be included in the next update.

Disclaimer: This is currently a fun project, which is why I was not able to put a lot of time in verifying information that I gathered.. One goal of this post is to gain feedback to actually be able to post an update in one month with a much higher data quality and more variables. So if you have any feedback on data or variables, feel free to contact me at ante@sicos.io. If you want me to add a project, it would be very cool if you could directly send me data (+source) on the project (like txps, block time etc.) That would save a lot of time. I’m not associated with any of these projects.

Lennart Ante

Written by

Co-founder of STOKR and the non-profit Blockchain Research Lab. Researcher at University of Hamburg.

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