Buying into the Top EVM Blockchain Tokens

EVM Blockchains

Last week I wrote about how to add some EVM blockchains to MetaMask. This week I will buy into the native tokens of these chains.

BNB, AVAX, MATIC, FTM, HT, STAKE, and ONE

EVM Blockchains are chains that use the Ethereum Virtual Machine (EVM). This means that porting projects onto EVM chains is relatively straightforward.

Some of the top EVM chains right now:

• Binance Smart Chain (BSC)
• Avalanche
• Polygon (Matic)
• Fantom
• Huobi ECO (HECO)
• xDai
• Harmony

Ethereum is of course an EVM chain as well - but unlike these chains, Ethereum is really expensive to interact with right now.

Speaking of gas, each of these chains has its own gas/utility token.

Gas tokens are important because they are needed to interact with the DeFi projects developed on these chains.

Why it matters

Each of these DeFi projects will have its own governance token. For example, PancakeSwap has CAKE.

PancakeSwap users are rewarded with CAKE when they provide liquidity to the protocol. The rewards are based on the share of the liquidity pool one owns.

Larger stake in pool -> More rewards

The same is the case for pretty much every other DeFi project out there: You provide liquidity to the smart contracts and in return, you receive governance tokens which you can sell for profit.

Important thing is:

Rewards are much higher for new DeFi protocols (smaller pools).

And where do the new DeFi protocols exists?

On the new EVM chains.

That’s it. That’s why a lot of people are excited about these new EVM chains - because they are money printing machines.

As long as you DYOR on the DeFi projects and adjust for risk, you can make a lot of money from yield farming on these chains.

Have a look at vfat.tools to find new DEXs, AMMs, DAOs, etc.

Now for an aside:

Ethereum Maximalism vs Multichain Future

There are two schools of thought right now. The Ethereum Maximalists and the Multichain Futurists.

The Maximalists believe that DeFi will be a winner-take-all battlefield - and that Ethereum will be that winner.

Ethereum is indeed the most widely used and secure EVM chain of them all. And the majority of the innovation in DeFi has come out of Ethereum projects.

But Ethereum was the victim of its own success. The DeFi Summer on Ethereum caused gas prices to sky-rocket. 

This pretty much destroyed the use case for smaller investors. After paying the initial fees to deposit into a yield farm, it would take months for a small deposit to break even.

Then came Binance Smart Chain and PancakeSwap, game changers for the smaller players.

BSC made it easier for everyone to participate in DeFi. And although most of the projects on BSC were copy and pasted from Ethereum, DeFi as a whole gained much more traction from the increased user base.

Some people do have issues with BSC however. It is very centralized compared to Ethereum. There are only 21 validator nodes in the network. And the entire project was created from the privately-held company Binance.

Now we are seeing other EVM chains emerging. Polygon is really popular right now. HECO has been around. Fantom, Avalanche, Harmony are coming up too.

Not to mention the other, non-EVM chains like Solana, Terra, and Flow.

Each of these chains have varying degrees of decentralization. Some are faster than others. Some are greener than others.

I think that people will choose what network fits their philosophy. Some people don’t care about centralization. Others need speed. And being green is very important (ahem Elon).

OK back to it, let’s buy some tokens.

EVM Wallets

So from my last post, I have wallets set up for each chain.

To add these chains to your MetaMask, check out that post.

If you already know how to add a network, see this gist for the network information.

I’m going to buy all seven:

BNB, AVAX, MATIC, FTM, HT, STAKE, and ONE

and we’ll see how well they do over time compared to each other.

On-ramps

There are three options:

• CEX to chain 🏛 ⛓
• Chain to chain ⛓ ⛓
• CC to chain 💳 ⛓

1. CEX to chain 🏛 ⛓ : Crypto Exchange withdrawal to Mainnet

Most exchanges will let you buy the gas token (e.g. BNB) and withdraw to the native mainnet of that token.

Just make sure that you are withdrawing to the native chain of the token. For example, on Binance, you will have the option to withdrawal BNB as either a BEP2 token or a BEP20 (BSC) token. For our case, we would want to withdraw as a BEP20 token because we want it on the BSC chain.

2. Chain to chain ⛓ ⛓ : Cross-chain bridge

I use cross-chain bridges when I can’t withdraw from an exchange.

Cross-chain bridges are still quite young. They rely on the smart contracts on both ends of the bridge. So just like any smart contract that you give your money to - DYOR first.

3. CC to chain 💳 ⛓ : Credit cards

These might be the easiest of all - but I haven’t used one yet.

But ramp.network and transak are two options that I know of.

How I did it

I have all of these tokens on their respective chains now:

BNB, AVAX, MATIC, FTM, HT, STAKE, and ONE

I will list the steps I took below:

BNB on BSC

Type: CEX to chain 🏛 ⛓

Steps:

1. Buy BNB on Binance
2. Withdraw to BSC wallet

MATIC on Polygon (Matic)

Type: Chain to chain ⛓ ⛓

Steps:

1. Buy BNB on Binance
2. Withdraw to BSC
3. Swap BNB to DAI on Sushi
4. Bridge DAI (BSC) to DAI (Polygon) using xpollinate.io
5. Swap DAI to MATIC on Sushi

Bonus: Fiat-on-ramp guide from the official Matic docs.

HT on HECO

Type: CEX to chain 🏛 ⛓

Steps:

1. Buy HT on Huobi
2. Withdraw to HECO chain wallet

AVAX on Avalanche

Type: CEX to chain 🏛 ⛓

Steps:

1. Buy AVAX on Binance
2. Withdraw to Avalanche chain wallet

FTM on Fantom

Type: CEX to chain 🏛 ⛓

Steps:

1. Buy FTM on Binance
2. Withdraw to Fantom chain wallet

ONE on Harmony

Type: Chain to chain ⛓ ⛓

Steps:

1. Buy ONE on Binance
2. Withdraw to Harmony chain wallet

STAKE on xDai

Type: Chain to chain ⛓ ⛓

Steps:

1. Fund FTM Wallet
2. Swap FTM to DAI using SpookySwap
3. Bridge DAI (Fantom chain) to DAI (xDai chain) using xpollinate.io
4. Swap DAI to STAKE using HoneySwap

…and that’s it! All 👏 wallets 👏 are 👏 funded. Finally.

This takes some time for sure. Ease of onboarding has a long way to go.

But things are always tough for early adopters 😏.

Let the Race Begin

I put $100 USD worth into each.

I’ll give bi-weekly updates on this investment over time.

Quick thoughts

I have more confidence in some than others. It will be interesting to see how things end up. But here’s my quick thoughts on each right now:

• Binance Smart Chain (BSC): The OG. BSC fees are already creeping up. But the fact that it is a PoS chain leads me to believe the fees will never reach the heights of Ethereum. I don’t think BSC is going anywhere, but I also think most of the growth has already occurred.

• Avalanche: I was excited about this one from its use of subnets. Gas fees are kinda high though. I think there’s a minimum gas limit? I thought that was weird. I don’t know much about this one.

• Polygon (Matic): The L2 Solution for Ethereum (or at least marketed as that). Not sure why Polygon didn’t use ETH for its gas token. I think Polygon is right in the middle of its growth spurt. Optimism is coming out soon, which is another L2 for Ethereum. So we’ll see how that affects it.

• Fantom: I think Fantom could follow a similar path as Polygon. I see a lot of Fantom vs Polygon tweets. Not sure why. I guess they are competitors? I need to research Fantom more.

• Huobi ECO (HECO): I’m the least confident in this one. It’s been around for a while but it seems like the new DeFi projects are choosing other chains to build on.

• xDai: xDai is unique in that its gas token is the stablecoin XDAI. I think this model is better. Terra (big fan) does this as well with UST.

• Harmony: I know very little about this one. Harmony is also being marketed as a L2 for Ethereum. Not sure why these L2s don’t use ETH as the gas token…

What’s Next

I’ll be tracking the portfolio here.

I’ll be coming out with bi-weekly updates on how these tokens are performing.

Stay tuned!

Referral Links:

Links (with ref codes) to the sites I mentioned in this post:

• 💰 Binance was used to fund BSC Mainnet.
• 💰 Huobi was used to fund HECO Mainnet.
• 💰 Crypto.com was used to fund Avalanche Mainnet.

✌️