Goldman Sachs breaks pros cons top 5 altcoins: how to profit from them without having to own them - The cryptocurrency sector has long experienced a boom among retail investors and blockchain tech enthusiasts, but the fever is lately shifting to other types of investors. Some banks, such as JPMorgan, Bank of America, Morgan Stanley or Deutsche Bank, have been recruiting crypto experts for the past few years.

Some of these investment firms have even bet on bitcoin-related products. Morgan Stanley has recently purchased 28,000 shares in Grayscale Bitcoin Trust. And others, like Black Rock, the world's largest fund manager, are already making profits through the same cryptocurrency.

But experts still have doubts about whether cryptocurrencies are a type of asset that can be integrated into the institutional ecosystem. A report on digital assets, published a few weeks ago by the Goldman Sachs fund, tries to lower the temperature of investors in relation to cryptocurrencies, especially the alternatives, altcoins.

Goldman Sachs breaks pros cons top 5 altcoins

The study, prepared by a team led by the head of the Strategy Group at Goldman Sachs, Sharmin Mossavar-Rahmani, believes that blockchain-based technology will bring greater efficiency to business operations and limit the ability of big techs to abuse personal data.

However, the report notes that cryptocurrencies associated with this technology "are not a viable investment for inclusion" in diversified portfolios.

Here's what Goldman Sachs experts think about ethereum and five other blockchain platforms and their respective altcoins, with the pros and cons of each.

Ripple (XRP)

Ripple is a fast payment platform, integrated into the global banking system. It uses a blockchain that connects hundreds of financial institutions around the world with a very simple application programming interface that is designed for fast, secure and affordable transactions.

Mossavar-Rahmani acknowledges that its price and speed are its biggest assets, but that it is not as centralized as other blockchain platforms.

The dispute he has with the US Securities and Exchange Commission, which wants its cryptocurrency, XRP, to be subject to regulation, also plays against him.

Goldman Sachs breaks pros cons top 5 altcoins

Ethereum (ETH)

Goldman Sachs refers to ethereum as a pioneer in decentralized blockchain technology. It also highlights that it is the most used platform and has a solid staff of developers.

But the report adds that updates to the blockchain have become obsolete, so investing in it can be complicated and risky.

And as more applications are developed on the ethereum network, its ability to control more transactions quickly the concern increases.

The ethereum blockchain should be updated this July and update its fees. What this means may be very clear to blockchain developers, but it is not so clear to investors, who have difficulty predicting how it will affect the value of ether.

Polkadot (DOT)

Polkadot, recognized for its ability to connect different blockchains called "parachutes". Goldman Sachs believes that the advantages of polkadot are that it is scalable, interoperable and customizable. However, it also considers that its technology is complex and its uses are not entirely clear.

Goldman Sachs breaks pros cons top 5 altcoins

Solana (SOL)

Solana defines itself as an open infrastructure, which is key to its global implementation. The platform also ensures that your platform is secure and censorship-resistant.

Goldman Sachs ' study notes that Solana is one of ethereum's competitors and that the platform has the fastest public blockchain. It also highlights that it is cheap and easy to use by developers.

However, it also believes that its ecosystem is smaller. In this sense, it should be noted that the more developers use the blockchain, it will grow more and improve.

Algonquin (ALGO)

Algorand aims to increase the speed of transactions and solve three problems: security, scalability and decentralization.

Goldman Sachs believes that this blockchain platform is strong, fast and good for developers. But the investment firm adds that it is still small, being new.

Dfinity Internet Computer (ICP)

Dfinity is committed to extending and democratizing the internet in the blockchain world through an unlimited environment that aims to provide a decentralized global computing cloud.

Goldman Sachs indicates that this technology is innovative and believes that it could lead the way to replace the internet with a new model that allows organized hosting of data and applications.

But the firm warns that the platform is complex, too new and has not yet been tested. After the launch of its cryptocurrency, IPC, this May, the token plummeted by 90% in one month.

Goldman Sachs breaks pros cons top 5 altcoins

Goldman Sachs does not rule out the entire cryptocurrency industry

The complexities of blockchain technology, the lack of regulation and investor protection, the high energy consumption associated with mining activities, as well as the rapid development of the sector, which could render blockchain-based technology obsolete, lead Mossavar-Rahmani to conclude that cryptocurrencies are not a "viable investment" for diversified portfolios.

While Goldman Sachs apparently rejects blockchain-linked cryptocurrencies, it does not rule out the cryptocurrency sector as a whole.

The investment firm recommends exposure to this growing industry through private equity and venture capital companies. In this sense, he advises investing in projects and innovations within the sector, but that are not limited to blockchain platforms.

It also recommends investing in public shares, such as stock baskets exposed to platforms based on blockchain technology.