Last year, Wealthsimple launched it Crypto platform. It was the first and only regulated crypto exchange in Canada. The idea was simple: you should be able to buy and sell Bitcoin (BTC) and Ethereum (ETH), with the same confidence (and, you know, simple-ness) you buy and sell stocks. The world of crypto has grown by leaps and bounds since then, so we’ve decided to grow what Wealthsimple Crypto can do too. Today, you can buy and sell way more coins and tokens.
OK, more coins and tokens. Amazing. All I need to know now is: what’s a token?
Let’s start with a blockchain — Ethereum or Bitcoin are blockchains, for instance. There are two different kinds of assets you can find on any blockchain, native assets and tokens. A native asset is the cryptocurrency for that blockchain. For example, on the Ethereum blockchain, the native asset is ETH. Any other asset that’s built onto a blockchain besides its native asset is called a token.
Let’s take Ethereum as an example again. There’s an application called Uniswap that’s built on Ethereum’s blockchain. Their token is called UNI. Tokens are a lot like any cryptocurrency. They are fungible (unlike NFTs, for instance, which are each non-fungible or unique). That means that one token is essentially like any other — just like how a dollar can be used interchangeably for any other dollar. UNI, for example, can be used in a lot of the same ways one might use ETH or BTC: you can buy UNI and hold it like an investment; you can use UNI to trade for other tokens; and you can theoretically use it to buy things, but it’s not that common.
Part of the reason tokens are valuable is that people use them to interact with applications and protocols — like DeFi (or “decentralized finance”) projects — that will hopefully grow in the future. But right now, people tend to buy them as speculative investments – the same reason people buy stocks (though they are much different than stocks).
We should also note that our platform is built so you can buy and hold these assets (or sell them when you think the time is right). You can’t spend or transfer them from Wealthsimple Crypto today, though we’re building that capability for the future.
Which coins and tokens can you buy on Wealthsimple Crypto now?
We have plans to offer many of them, including many our clients have been asking about the most and that meet our standards. (We thoroughly review each asset for factors such as security and audits, governance, maturity, demand, and liquidity.)
The new assets we’re offering are either peer-to-peer cryptocurrencies or the tokens of DeFi protocols (you can read more below). Here’s a list of them:
Bitcoin Cash: BCH is a native asset — on what’s called a “fork” from the Bitcoin blockchain — created by a group of Bitcoin coders. It’s a peer-to-peer (P2P) digital currency that makes it easier to optimize the Bitcoin blockchain for payments with its low transaction costs.
Litecoin: LTC, like BCH above, is also a peer-to-peer (P2P) digital currency and a “forked” native asset that once coexisted on the same blockchain as Bitcoin. It claims to have faster transaction confirmation times and improved storage efficiency compared to its counterpart.
Dogecoin: DOGE is a hugely popular, extremely meme-y, open-source digital currency that was “forked” from Litecoin in 2013. It was based on a dog meme and was supposed to be a joke but ended up proving that even meme jokes can become bizarrely valuable in 2021. Much wow.
Basic Attention Token: BAT is what’s called an Ethereum “utility” token that’s exclusive to the Brave ecosystem. Through its software, Brave plans to decentralize the digital advertising industry by rewarding Brave users in BAT for the ads they watch.
Aave: AAVE is what’s known as a DeFi (or “decentralized finance”) token. DeFi tokens are associated with apps primarily built on the Ethereum blockchain to revolutionize how all types of financial transactions work. Aave lets you lend and borrow cryptocurrencies on its platform, and token holders can vote on how the platform is run.
Balancer: BAL is the token for Balancer, a DeFi protocol that’s a decentralized exchange and automated market maker that allows anyone to provide liquidity and offers exchange-like functionality.
Chainlink: LINK is the token for Chainlink, a decentralized oracle network powered by Ethereum. It uses decentralized nodes to help smart contracts verify the legitimacy of data from an external source.
Compound: COMP is the token for Compound, a DeFi protocol powered by Ethereum. Participants on its platform can lend and borrow various cryptocurrencies while earning interest on any cryptocurrency they’ve deposited.
Curve: CRV is the token for Curve Finance, a DeFi protocol that provides an easy way to trade “stablecoins” (which are coins pegged to fiat currencies, like the US Dollar) and other like-for-like assets. It’s an automated market maker that allows anyone to provide liquidity through smart contracts.
Kyber Network: KNC is an Ethereum token used to participate in the Kyber Network and its governing DAO (decentralized autonomous organization). The Kyber Network makes it easy to swap different cryptocurrencies without the need for an exchange.
Maker: MKR is a governance token powered by Ethereum. It was created by MakerDAO (decentralized autonomous organization) to manage its own USD stablecoin called Dai. MKR token holders can vote on how the platform is run, including creating and collateralizing Dai.
Synthetix: SNX is the token for Synthetix, a decentralized exchange (DEX) powered by Ethereum. Through its platform, users can create and trade “synthetic” versions of stocks, currencies, or other commodities through smart contracts.
Uniswap: UNI is the governance and reward token of Uniswap, a platform built on Ethereum, which operates as a decentralized exchange (DEX) and automated market maker that swaps tokens in liquidity pools to get the best price.
Yearn.Finance: YFI is the governance token for Yearn.Finance, a platform built on Ethereum, which automatically invests in DeFi protocols to maximize yields and generate as much interest as possible.
Added July 28, 2021:
0x: ZRX is the token for 0x, an open protocol, peer-to-peer (P2P) exchange of Ethereum-based tokens. Its platform provides a mechanism that allows orders to be placed off-chain while keeping trade settlement on-chain.
Filecoin: FIL is the native asset of Filecoin, a network for the monetization of decentralized peer-to-peer (P2P) file storage. Built by Protocol Labs, the Filecoin protocol aims to enhance internet infrastructure technology.
Polygon: MATIC is the governance token for Polygon (formerly known as the Matic Network), powered by Ethereum. Through its network, users can perform faster and cheaper transactions securely by leveraging sidechains that run alongside the main Ethereum chain.
SushiSwap: SUSHI is the token for SushiSwap, a decentralized exchange (DEX) and automated market maker powered by Ethereum. Born as a fork from Uniswap, users within the network buy and sell within pools via smart contracts.
Why would I buy these anyway?
People often buy crypto assets for the same reason they might buy any other investment: they think it’ll be more valuable in the future. But the reason some people think these assets might increase in value is more nuanced: they are built on top of applications that are doing some pretty innovative stuff. Just look at the list of revolutionary goals the tokens above are built to support — they have the potential to change the way our financial systems work for the better.
However, as with any asset, you should be prepared for a wild ride. The crypto market is relatively new and its assets are speculative in nature, so you should always do your research before engaging in trading.
How do I do it?
Buying and selling these assets on Wealthsimple Crypto isn’t any different from buying and selling Bitcoin and Ethereum on Wealthsimple Crypto: just be sure to update your Trade app to the latest version and off you go. You can use the same simple UI (user interface), and your transactions will be protected by the same super robust security measures as anything else you do with us.
Note: You may now buy as much Bitcoin, Ethereum, Litecoin, or Bitcoin Cash as you like. (Learn more about the rest of our purchase limits in our Help Centre here.)
And, of course, when you invest with Wealthsimple Crypto, your assets will also be completely secure — all our cryptocurrency and tokens are locked up in cold storage with Gemini, our partner custodian.
What’s next for Wealthsimple Crypto?
A lot. Our mission is to be the most robust and trusted crypto platform in Canada. We have lots more features shipping over the next few months, so watch this space!
