World’s second largest stock exchange, NASDAQ has started listing cryptocurrency prices on its Global Index Data Service (GIDS) as revealed in an official announcement on its platform.
The cryptocurrency indices – Bitcoin Liquid Index (BLX) and Ethereum Liquid Index (ELX), provide real-time information on the price of 1 BTC and 1 ETH in dollar equivalents based on the most liquid ends of their respective markets.
Both indices are handled by market data and blockchain firm – Brave New Coin and will be updated every 30 seconds. The listing will utilize Nasdaq’s exchange surveillance technology which helps people identify price manipulation attempts.
According to Nasdaq, the BLX and ELX will work by capturing data from multiple exchanges to provide a single price for Bitcoin (BTC) and Ethereum (ETH), which will enable traders get in and out of given market positions. Nasdaq and Brave New Coin in their confirmatory remarks explain that the methodology has been verified by the International Organization of Securities Commissions (IOSCO). In their comments, both emphasize that “the methodology adds to transparency of pricing crypto assets, a concern that has prevented regulators in approving retail products.”
Besides the BLX and ELX, the announcement also indicates that Ripple Liquid Index (RLI) for XRP coin may soon launch; even as there are questions on volume comparisons it is logical that since the top two have been listed, third place XRP could follow suit.
Haven shown likely hood of introducing cryptocurrency indices before now and with a Bitcoin ETF being hugely considered by the U.S SEC, CEO of Brave New Coin opines, “The crypto derivative wave is inevitable.”
The blockchain company CEO further explained;
Once custody was solved, first with Fidelity’s announcements last November, and now with indices that align with IOSCO principles being available through Nasdaq, there’s going to be a rush to produce all manner of financial instruments, which the institutional users have been asking for almost 3 years now.
Nasdaq remains the world’s second largest stock exchange by market capitalization, only behind the New York Stock Exchange (NYSE) and boasts of a total market value of $10 trillion. With its far reaching values and over 3,400 companies listed on its platform, the introduction of cryptocurrency indices will benefit the crypto community as it will draw in institutional investors and breed more credibility and confidence within the space.
This Nasdaq listing would also depict more stability and transparency for cryptocurrency prices as Nasdaq looks to maintain and ensure a fair global value for the price of Bitcoin and Ethereum.
Additionally, the listing is seen as a pre-empt to the introduction of traditional stock market investors into the crypto space, with a positive effect on driving mainstream adoption.