Crypto Index to Appear on the NASDAQ Platform
One of the latest signs that cryptocurrencies are becoming increasingly mainstream comes from the NASDAQ platform. They are now going to list a crypto index showing the top 100 coins.
This will ensure that information on these tokens is more widely available. How does it work and what could it mean for the market?
Which Crypto Index Is Covered?
The CIX100 is the index that is to be included. This is published by the Cryptoindex site and acts as a benchmark for the cryptocurrency market.
They use more than 200 different factors and a proprietary formula to calculate the listing. First of all, they filter out the currencies that they deem to have fake volumes reported. They also remove any from unscrupulous sources or that have been manipulated.
After that, their AI algorithm, called Zorax, looks at data from the 9 biggest crypto exchanges. No names are given, but the biggest exchanges right now include the likes of Coinbase, Kraken and Bitfinex. Indeed, the top 8 exchanges hold close to 7% of all the Bitcoin in circulation.
They also take into account other data gathered from a variety of online sources. These include Twitter, news feeds and GitHub.
The process then sees the overall list of 1,800 coins narrowed down to 200. This is done partly by looking at which ones have spent at least the last 3 months in the top 200. The next step is to narrow the list down to 100.
Every coin has a weight allocated to it. This crypto index also includes price predictions, with an 82% accuracy rate mentioned in reports. Kirill Marchenko is the Cryptoindex Project Manager. He is quoted as calling their crypto index a “more accessible and convenient financial instrument for all types of investors, not only professional,”
What Does This Change for Investors?
At the moment, NASDAQ’s adoption of this cryptocurrency index doesn’t change a lot for most investors. However, it is seen as being another step in the right direction by those people who want to see digital coins go mainstream.
We can expect more people to find the latest details on the top coins now. It might even encourage some potential investors to take the first step, backed up by the data that they see.
It has to be said that this crypto index seems fairly Bitcoin-centred. However, it may be that over time it loses this Bitcoin focus.
The more tools that are easily available for new investors the better for the crypto development. This is another tool that will let people make more informed decisions and take a bit of the mystery out of crypto investments.