CoinMarketCap will launch two comprehensive headline indices calculated and administered by Solactive, the German index provider
Today, we will be launching two cryptocurrency benchmark indices on NASDAQ GIDS, Bloomberg Terminals, Thomson Reuters Eikon (Refinitiv), and Börse Stuttgart. These indices will be the most comprehensive ones on the market, covering the Top 200 cryptocurrencies by market capitalization, one including Bitcoin, and one without.
Our cryptocurrency benchmark indices will help users to quickly reference and track the general performance of the cryptocurrency market. Including 200 cryptocurrencies weighted by market capitalization, the headline index CMC Crypto 200 Index (CMC200), which includes Bitcoin, essentially covers more than 90% of the global cryptocurrency market. Another index excluding Bitcoin, CMC Crypto 200 ex BTC Index (CMC200EX), has also been created to track the performance of the market without the influence of Bitcoin, a cryptocurrency dominating ~50% of total market capitalization at the time of writing.
“We are excited to launch and share these indices with the market,” says Brandon Chez, CEO of CoinMarketCap, “These indices will promote greater accessibility to cryptocurrency data in an easier-to-digest format. In partnership with Solactive, our chosen index administrator, we hope these professionally-calculated indices will serve to expand the reach of cryptocurrencies into the larger financial markets.”
Brandon Chez, CEO of CoinMarketCap
At CoinMarketCap, we pioneered the use of the terms “market capitalization” in the cryptocurrency space back in 2013, when we needed to a way to quickly compare other cryptocurrencies to Bitcoin. We also created the term “circulating supply”, inspired by the concept of “public float” in equities. We also popularized “Bitcoin dominance” as a quick indicator of Bitcoin’s market capitalization against the value of all other listed cryptocurrencies. With the indices launching today, we aim to capture these data points in a single, easy-to-use index performance number that can efficiently describe the state of the cryptocurrency market.
The market capitalization for each cryptocurrency calculated as “price multiplied by circulating supply”. The circulating supply metric used by CoinMarketCap accounts for locked, reserved or non-saleable coins or tokens that cannot affect the price of a cryptocurrency, and hence are not factored into a cryptocurrency’s market capitalization.
Solactive AG, the independent German index provider, will calculate and administer the CoinMarketCap indices to exacting standards and strictly adhere to the stated methodology, such as rebalancing the index quarterly accordingly. The company counts among its index-calculating capabilities a Cboe Bitcoin Futures index launched in December 2017. Administering over 3,000 custom indices, Solactive is well-placed to provide and uphold the standards required to launch and maintain these comprehensive, market-wide indices in collaboration with CoinMarketCap. Solactive is fully compliant with the IOSCO Principles for Financial Benchmarks.
Building on CoinMarketCap’s data, Solactive will hence be able to offer tailored index solutions to clients also interested in licensing these indices for their own use, such as for display or for creating derived data and products.
“We are very proud to be chosen as CMC’s index provider of choice in this exciting journey,” expresses Fabian Colin, Head of Sales at Solactive. “The ability to access CoinMarketCap data gives us the opportunity to develop custom indices for new clients. Conversations have already started. We are looking forward to developing more crypto indices in the future, which will optimistically result in investable indices and might lead to further products.”
Fabian Colin, Head of Sales at Solactive AG
The indices are rebalanced on the last day of each calendar quarter. The index constituent weights are fixed on the selection date, which is five days prior to the rebalancing date. At this time, all eligible cryptocurrencies are ranked by their current market capitalization. This ensures that growing or shrinking cryptocurrencies are accurately represented in the overall index. At any time, if a cryptocurrency is no longer eligible for membership, a replacement is named at the next scheduled rebalancing.
These cryptocurrency benchmark indices are now available on NASDAQ GIDS, Bloomberg Terminals, Thomson Reuters’ Eikon (Refinitiv), and Börse Stuttgart. Additionally, they will be prominently displayed on the CoinMarketCap website, which is the most-trafficked site in the cryptocurrency space.
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Solactive AG is an innovative index provider that focuses on the development, calculation and distribution of tailor-made indices across all asset classes. As at January 2019, Solactive AG served approximately 400 clients in Europe, America and Asia, with approximately USD 200 billion invested in products linked to indices calculated by the company globally, primarily via 380 exchange-traded funds from a number of well-known providers. Solactive AG was established in 2007 and is headquartered in Frankfurt.
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