S&P Dow Jones Will Debut Cryptocurrency Indexes in 2021

One of the world's biggest index providers is getting into the cryptocurrency game. S&P Dow Jones Indices, a division of S&P Global, announced yesterday that it is planning to launch cryptocurrency indexing services in 2021 for more than 550 of the top traded coins.

Key Takeaways

  • S&P Dow Jones Indices will launch an indexing service for cryptocurrencies in partnership with Lukka, a crypto data firm, next year.
  • The service is intended to provide reliable and transparent pricing data.
  • The move comes at a time of piquing institutional interest in the asset class.

The service will enable clients to create custom indices and other benchmarking tools related to cryptocurrencies. S&P Dow Jones Indices will partner with Lukka, a crypto data firm, for pricing data. The partnership is a move to provide "reliable pricing data" for cryptocurrencies, according to a press release. Lukka already has a data partnership with IHS Markit, a research firm that S&P recently acquired.

In a conversation with online publication Coindesk, Peter Roffman, global head of innovation and strategy at S&P Dow Jones Indices, said that the digital asset industry was "at a point of institutional interest in maturity" and that his firm's product was intended to contribute to the marketplace's transparency. "It's going to really employ best practices, both in terms of pricing the coins, selecting the coins, weighting them, you know, and all of the concomitant transparency that we bring to the marketplace," Roffman told Coindesk.

The move by S&P Global comes at a time of renewed interest in Bitcoin (BTCUSD). Several big names in mainstream finance have included or discussed the possibility of including Bitcoin in their portfolios. Japanese investment bank Nomura Holdings launched a hybrid custodian tool, aimed at institutional investors, for cryptocurrencies in November. The economic uncertainties generated by the COVID-19 pandemic sparked a rally in the cryptocurrency's prices, leading it to an all-time high recently.

Other notable crypto indexing products in the market are the Bloomberg Galaxy Crypto Index (BGCI) and the ICE Cryptocurrency Data Feed. The Nasdaq stock exchange also announced the listing of an artificial intelligence-powered crypto index last year.

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