A new cryptocurrency index was launched on Wednesday by Bloomberg and Galaxy Digital Capital Management, the asset management firm founded by legendary investor and Bitcoin bull Mike Novogratz, providing what the companies called the first institutional grade benchmark for the cryptocurrency market.
The Bloomberg Galaxy Crypto Index (BGCI), is designed to track the performance of the largest, most liquid portion of the cryptocurrency market, according to a statement.
The BGCI is market capitalization-weighted and measures the performance of ten USD-traded cryptocurrencies, including Bitcoin, Ethereum, Monero, Ripple, and Zcash. Index constituents are diversified across different categories of digital assets, including stores of value, mediums of exchange, smart contract protocols, and privacy assets.
The creation of the index marks an important step in the evolution of the digital assets space, facilitating diversified exposure as well as independent benchmarking for investors, the companies said in the statement. The BGCI utilizes a rules-based methodology and data from sources that have passed both Bloomberg and Galaxy Digital Capital Management’s due diligence processes.
The index is owned and administered by Bloomberg Index Services Limited and is co-branded with Galaxy Digital Capital Management, which Novogratz founded following a storied career as Principal and Chief Investment Officer of the Fortress Macro Funds, and a former Partner at Goldman Sachs.
“The Bloomberg Galaxy Crypto Index brings unprecedented transparency to the crypto markets. We are excited to help drive the decentralized revolution forward through the creation of BGCI,” Novogratz said in the statement.
“Today’s launch of the Bloomberg Galaxy Crypto Index reflects our clients’ growing interest in cryptocurrencies,” stated Alan Campbell, Global Product Manager for Bloomberg Indices. “The index brings our rigorous approach to index construction to cryptos and will provide investors with a transparent benchmark to gauge the performance of the broader market.”
The BGCI contains the following ten cryptocurrencies and weightings at inception: Bitcoin (30 percent), Ethereum (30 percent), Ripple (14.14 percent), Bitcoin Cash (10.65 percent), EOS (6.11 percent), Litecoin (3.77 percent), Dash (1.67 percent), Monero (1.66 percent), Ethereum Classic (1 percent) and Zcash (1 percent).
Steve Kurz, Head of Asset Management at Galaxy Digital Capital Management, added: “We are thrilled to partner with Bloomberg on the BGCI. The index’s independent, rules-based methodology provides a strong foundation on which the cryptocurrency ecosystem will continue to grow and mature.”