This paper provides a comprehensive analysis of the sector structure within the digital asset market. We identify a sector structure within the digital asset market, where different types of digital assets (the “digital asset sectors”) exhibit different risk and return characteristics. We examine the observed sectoral variation through two channels: the systematic risk channel and the idiosyncratic risk channel. We find that although overall sectoral differences exist, they are not driven by variations in systematic beta exposures. Instead, sector-specific information emerges through the idiosyncratic risk channel. The sector risk factors, which capture this sector-specific information, exhibit significant variability. Further analysis reveals that such sectoral differences are driven by sector-specific events, sector momentum, and inter-sector spillovers.