As cryptocurrency investments become more mainstream, Nasdaq and CME Group have joined forces to rebrand a crypto index. Here’s a look back at the announcement.
Nasdaq and CME Group announce the rebranding of this crypto index
Last Thursday, Nasdaq and CME formalized a new partnership, resulting in the rebranding of the Nasdaq Crypto Index to the Nasdaq CME Crypto Index (NCI).
First launched in 2021, the NCI offers exposure to the market’s leading cryptocurrencies, with Bitcoin (BTC) currently accounting for three-quarters of the index’s weighting:
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The symbol XBT for Bitcoin corresponds to the one used on financial markets: X for the fact that the asset is not linked to any country and BT for “Bitcoin.”
Beyond a name change, Giovanni Vicioso, Executive Director of Equities and Alternatives at CME Group, highlights the combination of “two benchmarks to offer the regulated diversification and building block that the market now demands.”
For his part, Sean Wasserman, Head of Index Product Management at Nasdaq, welcomes an asset class that can become more widely available as regulations in the United States become clearer, while also expressing his enthusiasm for this collaboration with the CME:
This announcement illustrates Nasdaq and CME Group’s commitment to bringing their collective market and indexing experience to the crypto-asset class. […] Cryptocurrencies are a relatively new and rapidly evolving asset class. During this period of growth, it is essential to be able to rely not on one, but on two trusted international organizations, each with solid market experience and a prudent approach to risk management and governance.
To date, the NCI index is used by Hashdex for its HASH ETP, capitalized at $154 billion and available in Europe, as well as for its NCIQ ETF, capitalized at $637.1 million.
While Sean Wasserman describes a 1-5% allocation of cryptocurrencies in a portfolio as a “tremendous opportunity in terms of adoption,” it will be interesting to see whether this index, whose name is now associated with two of the world’s largest stock exchanges, will develop more broadly in the future, in a context where investment in cryptocurrencies is becoming more widespread every year.
