This week, Nasdaq, the company that runs the world’s second-largest stock market, announced a dissemination relationship with Brave New Coin that will see two cryptocurrency indices added to the sprawling Nasdaq Global Index Data ServiceSM, or GIDS, the company’s “premier real-time datafeed,” on February 25th, 2019.
The indices, the Bitcoin Liquid Index and the Ethereum Liquid Index, will allow traders and institutions to track the prices of bitcoin and ether in order to make it easier to “evaluate investments and track portfolios.”
“The Bitcoin Liquid Index (BLX) and the Ethereum Liquid Index (ELX) are each designed to provide a real-time spot or reference rate for the price of 1 BTC and 1 ETH respectively, quoted in USD, and based on the most liquid ends of their markets,” the Nasdaq team said in the relationship announcement.
“Both indices are calculated using a methodology that has been independently audited against key IOSCO principles. The BLX is one of the most widely-referenced BTC indices among crypto traders and has been calculated back to 2010. Likewise, the ELX has been calculated back to 2014.”
The BLX and ELX, which will both have spot-rate frequency intervals of 30 seconds, will join tens of thousands of other mainstream indices on GIDS, which monitors 20 different index series covering global equities, commodities, and beyond. In this light, the price valuations of two of the cryptoeconomy’s top assets have taken another tangible step forward toward mainstream significance.
Nasdaq Inc., which presently bears a market capitalization above $10 trillion USD, has been making increased overtures toward the cryptocurrency space in recent months. In January, Forbes reporter Michael del Castillo revealed the company at that point had seen seven cryptocurrency exchanges start using its enterprise-grade surveillance tech product after the exchanges had successfully passed a “due diligence process.”
Brave New Coin, a cryptocurrency-centric data research company with offices in Auckland, London, Melbourne, and New York, also offers BNC Custom Indices, which can be used to track tailored cryptocurrency pairs in regions around the world.
Nasdaq Steadily Embracing Cryptoverse
In Nov. 2017, just as the cryptoeconomy’s last bull run was kicking into high gear, Nasdaq started working toward a bitcoin futures product for its Nasdaq Futures (NFX) exchange and had “briefed market participants on its plans,” per WSJ. Since then, the company has been mum on a release date for the offering.
The crypto pivot suggested that the stock exchange operators, whose platform is currently bested in trade volume among all the world’s exchanges only by the New York Stock Exchange, thought it could make a superior offering compared to America’s inaugural bitcoin futures products greenlighted for CME Group and CBOE Global Markets Inc. in Dec. 2017.
Likewise, in Dec. 2018, Nasdaq Ventures invested in the Series B fundraising round of ErisX, a forthcoming cryptocurrency derivatives platform that wants to take crypto contracts into the heart of Wall Street. It was an operational bet that the market for such derivatives has plenty of room to grow.
Moreover, it was only last spring that Adena Friedman, CEO of Nasdaq Inc., said the company’s leadership was open to the possibility of shifting into a cryptocurrency exchange in the future.
“Certainly, Nasdaq would consider becoming a crypto exchange over time,” Friedman said.
But it’s not all about just crypto for the company. Last summer, Nasdaq and a group of financial services enterprises collaborated with Dutch bank ABN AMRO on a blockchain-centric proof of concept designed to efficiently process margin calls in securities markets.
“We believe that blockchain technology brings with it a huge potential to transform markets everywhere, and this project is an excellent showcase of this,” Nasdaq Clearing CEO Julia Haglind said of the project.
Taken altogether, these various developments clearly indicate that Nasdaq’s wider forays into the cryptocurrency ecosystem may only be just beginning.