Bitcoin and Ethereum indexes are launched in the S&P DJI index
The S&P Dow Jones index has launched three new currency indexes. These three indicators are S&P Bitcoin, S&P Ethereum and S&P Crypto Mega Cap Index, which is a combination of Bitcoin and Ethereum .
A move we have been waiting for a long time
People have been waiting for a long time for a traditional financial product that can track the price of cryptocurrencies for a long time. In this regard, S&P announced last year that it intends to release its currency code index in 2021.
New indicators can be used as tracking and positioning tools in traditional financial space. On the other hand, more reliable pricing from a reputable source will protect investors from connecting to cryptocurrency APIs that may not provide the correct pricing data. S&P hopes the move will make it easier for investors to access the cryptocurrency asset class and even reduce some of the risks of a volatile cryptocurrency market.
While there is still no commodity (ETF) product that small investors can buy directly to access the real price of cryptocurrencies, the S&P move is more of a step towards legitimizing and consolidating the cryptocurrency market. The world of stocks and funds can be traded.
How this indicator works
These indicators use data from Lukka, a provider of data related to cryptocurrencies. Lukka's process examines various exchanges based on criteria such as transparency, data integrity, and other factors to determine their participation in the final pricing.
These indices track about 550 digital assets with the best market value index. Luca CEO Robert Materazzi added that working with S&P DJI is an important turning point in linking the cryptocurrency ecosystem to traditional financial services.
These three indicators will be available in the main index catalogs with the SPBTC, SPETH and SPCMC tickers, respectively. The SPCMC, meanwhile, is more interesting than the others because it is rebalanced every three months to change the ratio of the underlying cryptocurrencies (in this case BTC and ETH), given that it weighs in proportion to the market value. This ensures that investors will not be overexposed or underexposed to any of these currencies if there is a serious price move that could dramatically change the ratio of the index basket.