What is ANKR?
The ANKR token is the native utility and governance token for the ANKR network. ANKR tokens are used to pay for services within the ANKR ecosystem. The current Ankr network is built on three key principles: Chain neutrality, Full decentralization and web 3.0 infrastructure. The Ankr (ANKR) crypto platform comprises a suite of tools that streamline access to the decentralized web. Ankr’s product offerings can broadly be categorized into two main functions:
- Node Infrastructure: Ankr users can deploy dedicated validator and developer nodes, access application programming interface (API) endpoints, and participate in staking on Ethereum 2.0 (Eth2) and Binance Smart Chain (BSM), with plans for future integrations. The Ankr platform aims to eliminate barriers to entry by providing pre-built infrastructure that serves the diverse needs of Web3 stakeholders.
- StakeFi : Ankr also attempts to simplify the onboarding process for individuals looking to stake tokens on various blockchains and help validate transactions. StakeFI, integrates the financial system into web3 infrastructure and developer projects running on this infrastructure make the economy productive.
On the technical side ANKR is an ERC-20 governance token that operates on the Ethereum (ETH) blockchain. The total supply of ANKR is currently fixed at 14 million tokens. Previously approximately 2% of Ankr tokens have been burned with no further burning capabilities anticipated in the future.
How does ANKR compare to Bitcoin?
ANKR differs from Bitcoin in a few important ways.
First, Bitcoin is a “coin” and ANKR is a “token.” That is because Bitcoin powers the Bitcoin blockchain, and it is mined by a decentralized network of computers that solve complicated maths puzzles to verify transactions.
By contrast, ANKR is a token that runs on the Ethereum blockchain. On Ethereum, ETH is the only coin that can be mined and miners mine ETH to process ANKR transactions. It is what is known as an ERC-20 token, the name applied to the generic token standard for the Ethereum blockchain.
Being an ERC-20 token has perks. Blockchains aren’t great at speaking to each other—you can’t get an Ethereum contract to work with a Bitcoin smart contract without some complicated engineering. However, it’s very easy for ERC-20 tokens to speak to one another, which means that ANKR can be used in most other decentralized finance applications.
Unlike Bitcoin, ANKR is a governance and utility token. While, like Bitcoin, ANKR can be used as a means of payment or a store of value, its market price may be very volatile and so it may not be useful for payments or storing value.
Finally, ANKR’s market capitalization is smaller than Bitcoin’s. As of April 2022, ANKR’s market capitalization was estimated to be $1.6 billion, as compared to Bitcoin’s market capitalization of $800 billion.
Before trading any crypto assets it is important to understand the risks. This overview is a starting point for you to perform your own research prior to investing in a crypto asset. First and foremost:
No Canadian securities regulatory authority has expressed an opinion about ANKR, including an opinion that ANKR is not itself a security and/or derivative.
Wealthsimple has performed a legal assessment of ANKR prior to making it available on Wealthsimple Crypto and has concluded that ANKR is not and is unlikely to be deemed a security or derivative. However, there is a risk that this conclusion could change in the future and the impact of this on an asset’s value is outlined in our Product Disclosure.
We evaluated ANKR based on publicly available information, including (but not limited to):
- The creation, governance, usage and design of ANKR, including the source code, security and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that first created ANKR;
- The supply, demand, maturity, utility and liquidity of ANKR;
- Material technical risks associated with ANKR, including any code defects, security breaches and other threats concerning ANKR and its supporting blockchain (such as the susceptibility to hacking and impact of forking), or the practices and protocols that apply to them; and
- Legal and regulatory risks associated with ANKR, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of ANKR.
Like all other crypto assets, there are some general risks to investing in ANKR. These include short history risk, volatility risk, liquidity risk, demand risk, forking risk, cryptography risk, regulatory risk, concentration risk, electronic trading risk and cyber security risk. Each of these risks are described in more detail in our in-app Product Disclosure.
ANKR, is used as a medium of payment by those using node resources and a means of rewarding those who provide the node. ANKR therefore has a use other than investment and speculation based on the efforts of Ankr Inc. There is some concentration risk with the dependence on Ankr Inc. as the primary provider of nodes. However, Ankr Inc. has stated that it is increasingly decentralizing the protocol’s services by adding independent node providers. This will require further monitoring to ensure Ankr Inc is heading towards increased decentralization.
Further to these general risks, the ANKR community, development team and other affiliated entities are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of ANKR have no recourse to the Ankr Network or Wealthsimple if ANKR declines in value for any reason.
We emphasize that this Crypto Asset Statement is not exhaustive of all risks associated with trading ANKR. Investors should perform their own assessment to determine the appropriate level of risk for their personal circumstances.
WDA is offering Crypto Contracts in reliance on a prospectus exemption contained in the exemptive relief decision Re Wealthsimple Digital Assets Inc. dated June 18, 2021. Please be aware that the statutory rights of action for damages and the right of rescission in the securities legislation of each province and territory of Canada would not apply to a misrepresentation in this Statement.
Last updated: April 28, 2022