Crypto world gains five additional price indexes
In a cryptocurrency universe of more than 1,500 tokens, Fundstrat Global Advisors LLC has launched five additional price indexes to give investors even more ways to customize.
The five gauges — based on the sectors Commodities, Platforms, Privacy, Exchanges and Stable-coins — include 75 per cent of today’s crypto market cap. Commodity tokens comprise the largest chunk, at 47 per cent, but that’s because the index components are Bitcoin, Bitcoin cash, Litecoin, Monero and Zcash.
Prospective investors may want to look at the makeup of the indexes before jumping in, as they aren’t necessarily getting so much diversification. The Privacy index, for instance, has four components. The Stablecoin gauge has just two, with a 99 per cent weight to Tether and one per cent to DAI.
Fundstrat remains optimistic on the long-term success of Bitcoin, the largest of the cryptocurrencies.
“Commodity tokens, in our view, are on-ramps for institutional inflows, given the expanding options for access (futures, etc.),” strategists including Thomas Lee, Robert Sluymer and Sam Doctor wrote in a note Thursday. “And commodity tokens face less regulatory risk relative to other types of tokens at the moment.”
Fundstrat cites regulatory risks excessively priced into platform tokens as the key rationale behind creating the new benchmarks.