As many members already know, Coinbase and GDAX are interested in listing some ERC20 tokens. There have been several pump and dump taking advantage of potential rumors regarding listings. I don’t have information regarding what coins are actually going to get listed. However, this is my theory regarding which ERC20 tokens are going to be listed on Coinbase and GDAX. Before I continue, I would like to clarify few things.
1. What is ERC20 token?It’s a token based on Ethereum smart contract. Therefore, cryptocurrencies like Tron and OmiseGo are ERC20 tokens but Ripple it not.
2. Why should I care?Although Coinbase is criticized for its high fees and slow deposit time, it is one of the most widely used platform to exchange from fiat to crypto. Therefore, getting listed on Coinbase and also GDAX (They are connected) will pump the price by a lot.
So why flagship ERC20 tokens?As some are aware, Coinbase in planning to create a Coinbase index. This is huge. Think about how S&P500 Index changed the landscape of both investment and also S&P company itself. This will facilitate more sophisticated investors and funds to invest in cryptomarket.
You can find more information regarding Coinbase Index here:
https://am.coinbase.com/documents/cbi-methodology.pdfHow is Coinbase trying to build the index? “The constituent assets of CBI (Coinbase Index) are all the assets listed on GDAX. The criteria for assets to be listed on GDAX can be found in the GDAX Digital Asset Framework”
Coinbase is planning to build the index based on the assets listed on GDAX. Currently, the index is composed of only Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. Coinbase is interested in expanding the list. It’s very unlikely to list almost security tokens that have dividend or voting power. Most major exchanges are also worried about listing security tokens so Coinbase, which is located in the United States with the SEC carefully watching, is unlikely to risk listing them.
What are likely ERC20 tokens (probably utility tokens) that might get listed?My theory is that Coinbase is likely to list flagship ERC20 tokens such as Tron, EOS, Vechain, and Omisego.
Why? Because a market index requires heavy weights to well-represent the overall market. For example, think about S&P 500 and Dow Jones Industrial Average that are supposed to represent the overall stock market. That’s why one will likely find cryptocurrencies with relatively large caps when we are discussing any kind of crypto index.
Here are few examples:
http://crix.hu-berlin.de/https://cci30.com/So does this mean I should go and buy these large cap tokens?
This is just for information and not for any financial advice. In addition, some of these tokens like EOS are thinking of building their own mainnet eventually, which would not make it ERC20 anymore. So once again, the investment decision is up to you.
This is orginally from my blogpost:
https://steemit.com/coinbase/@analyst101/why-coinbase-gdax-is-likely-to-list-flagship-erc20-tokens-like-omg-hint-index
