S&P Dow Jones Adds New Crypto Indexes to Its Digital Asset Benchmarks

S&P Dow Jones has introduced five new crypto indexes in the first significant expansion of its recently launched series of digital asset benchmarks. 

The new launch is headlined by the Broad Digital Market (BDM) Index, which is designed to provide a wide snapshot of the digital assets market and covers more than 240 different tokens. 

S&P Dow Jones Launches New Crypto Indexes

The leading index provider has announced four other indices, which are essentially a subset of the BDM index. These include: the LargeCap Index centered on the performance of larger cryptos, the Ex-MegaCap Index, which excludes Ethereum and Bitcoin, the Ex-LargeCap Index, which excludes everything from the LargeCap and the LargeCap Ex-MegaCap Index that tracks the constituents of LargeCap Index and eliminates the assets under MegaCap Index.

To determine the eligibility and prices of the featured cryptocurrencies, S&P uses pricing data from Lukka, a crypto-asset software provider. The company partnered with Lukka last year as part of its strategy to enter the crypto sector and has since announced indices for Bitcoin and Ethereum and a combined index that tracks both currencies.

S&P is responsible for two of the most popular market indicators — S&P 500 and Dow Jones Industrial Average (also known as “the Dow”). Its first index was invented by Charles Dow in 1884 and the company has since developed other metrics to help investors navigate the ups and downs in the market.

S&P Targets Its Digital Market Indices at Crypto Investors

S&P believes the growing crypto market needs “transparent benchmarking” and “index-based solutions” that make it easier for investors to access this technology-based emergent asset class.  Peter Roffman, Global Head of Innovation and Strategy at S&P Dow Jones Indices, opines that the new digital asset indices provide crypto investors with the same insights that benefitted traditional asset owners for more than a century.

It’ll be interesting to see how the crypto community reacts to S&P’s new digital asset indicators, given its dependence on Bitcoin’s price to gauge market conditions.