S&P Global is set to introduce a new benchmark index that will monitor a diverse array of digital assets and blockchain-related firms, indicating an increasing acknowledgment of the crypto sector within conventional finance.
The S&P Digital Markets 50 Index, developed in collaboration with tokenization firm Dinari, encompasses 15 cryptocurrencies with a market cap of at least $300 million and 35 publicly traded companies in the field, each having a market cap of no less than $100 million, as S&P announced on Tuesday.
The components have not yet been disclosed, but no individual element will constitute more than 5% of the index. Some prominent companies in the sector include Bitcoin treasury firm Strategy (MSTR), crypto exchange Coinbase (COIN), and Bitcoin miner Riot Platforms (RIOT).
Cameron Drinkwater, chief product and operations officer at S&P Dow Jones Indices, noted that the expansion of the digital asset ecosystem has transitioned crypto “from the margins into a more established role in global markets.”
While these indexes are not directly investable, they serve as crucial benchmarks for tracking market performance and often form the basis for exchange-traded funds (ETFs) and other investment vehicles.
Dinari intends to launch a tokenized iteration of the index, termed a “dShare,” enabling investors to achieve direct exposure. The investable version is anticipated to debut by the end of 2025.
Related: Crypto mining, treasury stocks strike gold as Bitcoin booms
Indexing signals next wave of crypto recognition
A significant consequence of S&P’s entry into crypto indexing is the prospect of passive ETFs one day tracking the performance of the Digital Markets 50 Index, similar to how traditional index funds reflect equity benchmarks.
For instance, the SPDR S&P 500 ETF mirrors the S&P 500, enabling investors to achieve broad market exposure via a single product.
Numerous crypto index funds are already in existence. The Bitwise 10 Crypto Index Fund (BITW) follows the Bitwise 10 Index, which represents the largest digital assets by market cap.
In a similar vein, the Hashdex Nasdaq Crypto Index products — including HASH11 in Brazil and the Hashdex Nasdaq Crypto Index US ETF (NCIQ) in the United States — track the Nasdaq Crypto Index, providing diversified access to major cryptocurrencies through regulated exchange-traded products.
At the same time, recognition of tokenization as a game-changing financial technology is on the rise.
As Cointelegraph recently reported, the US Securities and Exchange Commission (SEC) is purportedly looking into a framework that would permit stocks to trade as tokenized assets on blockchain networks, potentially bridging traditional securities with crypto-style infrastructure.
Related: Morgan Stanley recommends ‘conservative’ crypto allocation for some portfolios
