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Without much fanfare, Nasdaq launched its Nasdaq Crypto Index (NCI) in December. 

Nasdaq has created the NCI to serve as aindustry benchmark for digital assets, and it is intended to be dynamic and broadly representative of the cryptocurrency market. The NCI tracks the performance of a diverse basket of USD-traded digital assets, each of which is evaluated along liquidity, exchange, and custody standards. In order to be included in the Index, assets must be traded on at least three vetted “Core Exchanges” and supported by at least two “Core Custodians.” The Index is free-float market cap weighted and will be rebalanced and reconstituted on a quarterly basis. Core Exchanges and Core Custodians are evaluated on an annual basis. 

The Index is calculated by CF Benchmarks Ltd., a regulatedLondon-based calculation agent with a focus on calculating and administering Digital Asset Indices. The initial list of digital assets included in the Index, their weighting, and core exchanges are as follows: 

Component 

Weight 

Bitcoin (BTC) 

78.61% 

Ethereum (ETH) 

16.86% 

Litecoin (LTC) 

1.58% 

Bitcoin Cash (BCH) 

1.03% 

Chainlink (LINK) 

1.27% 

Stellar Lumens (XLM) 

0.65% 

 

Core Exchanges 

Core Custodians 

BitStamp 

BitGo 

Coinbase 

Coinbase 

Gemini 

Fidelity 

itBit 

Gemini 

Kraken 

 

 

Hashdex announced that it is listing an ETF that is based on the NCI on the Bermuda Stock Exchange. For more information about the NCI, please see https://www.nasdaq.com/Crypto-Index and https://www.cfbenchmarks.com/indices/BRTI. 

LEGAL TOKENS

Nasdaq’s creation of a cryptoindex (in conjunction with Hashdex) is just one more example of institutional players taking an interest in crypto and blockchain. Now that Canada and Bermuda have approved the listing of crypto ETFs, can the U.S. be far behind? For now, it looks like the answer unfortunately is “yes.”

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Author's Assets

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Anthony Tu-Sekine | Partner

As the head of Seward & Kissel’s Blockchain and Cryptocurrency Group and a frequent commentator on all things crypto, Anthony advises clients on a wide range of evolving topics, including how to structure and issue security and utility tokens, registered and unregistered offerings of security tokenstoken custody, transfer and liquidity issues, non-security opinions, and investments in crypto assets by funds and other investors. A recognized leader on physical precious metals funds, Anthony represented APMEX Inc. and alternative asset manager Sprott Inc. in connection with the launch of OneGold.com, which allows investors to own gold documented on blockchain.

“You can work with regulators or you can really try to piss them off… If you really want to do the latter, then you should expect that they will bring every tool they have against you.” 

Anthony’s thoughts on BitMEX indictment, as published in Law360 article “BitMEX Case Seen as Blessing in Disguise for Crypto Sector”