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S&P Dow Jones launches crypto indices

Cryptocurrencies1Cryptocurrencies have taken a further step into the mainstream investment world after S&P Dow Jones unveiled indices based on the leading three digital currencies.

The S&P Bitcoin Index, S&P Ethereum Index and S&P Crypto Mega Cap Index will track the performance of digital assets tied to the currencies.

"Traditional financial markets and digital assets are no longer mutually exclusive markets," said Peter Roffman, global head of innovation and strategy at S&P Dow Jones Indices.

The launch comes at a time when cryptocurrencies aside from bitcoin are booming. Earlier this week ethereum broke the $3,000 mark, quadrupling its value for 2021.

The involvement of a major index provider like S&P Dow Jones is expected to attract more institutional investors, according to market players.

“It is significant because a broad swath of the institutional investor community base their products and performance on these widely accepted index providers,” said Henson Orser, president of Komainu, a regulated custodian for digital assets, jointly owned by Nomura, CoinShares and Ledger.

“[The launch of the index] will definitely lead to broader involvement as proponents of the allocation within firms have additional rationale to gain both internal and external approval of launching,” Orser told Funds Europe.

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