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BTSE exchange to launch DeFi index

15 Aug 2020, 00:00, , , ,

The BTSE exchange and Brave New Coin have announced an ambitious roadmap for the remainder of 2020 which includes an initial DeFi index and four other new indices by year’s end.

The first new product delivered by crypto index builders Brave New Coin will be a DeFi index. BTSE CEO Jonathan Leong says customers have been looking for ways to engage with the growing DeFi ecosystem and BTSE is committed to delivering a suite of products in the decentralized finance marketplace. Commenting on the index roadmap, Brave New Coin CEO Fran Strajnar says while traders are looking for DeFi related products, their needs are evolving rapidly and they’re also asking for “institutional-grade” features – something BNC can deliver given its long experience in building crypto indices. “BTSE recognizes the evolving needs of today’s traders,” he says, “and we’re pleased to be collaborating to provide state-of-the-art solutions for the BTSE platform.”

The announcement follows the launch of the BNC-BTSE Composite Index (BBCX) in October 2019 that tracks the real-time market performance of BTC, ETH, and LTC, and the launch of the BBAX in February this year which tracks the performance of a basket of large-cap alt-coins (ETH, XRP, LTC, and EOS) by free-float market capitalization based on order book data sourced from eight constituent exchanges – Binance, Bitstamp, Bitfinex, Bittrex, Gemini, Kraken, Coinbase-Pro and BTSE. An institutional-grade product, the BBAX is amongst the first in the world to track a basket of alt-coins across multiple exchanges at sub-second frequency.

BBAX
The BBAX is tradable in the futures market on BTSE only and real-time pricing of the index is available to view in the spot market.

Commenting on the launch of the BBAX at the time, Strajnar said that building one of the first indexes in the world to track an array of alt-coins at sub-second frequencies across this many exchanges was a key milestone for BNC.

Brave New Coin has long been a flag-bearer for robust price discovery in the sector and equipping traders, investors, and analysts “with the right tools to make informed and educated decisions," is another positive step forward Strajnar says. “BNC’s and BTSE’s index futures enable crypto traders to speculate on the direction of the market as a whole,” explains BTSE’s Chief Product Officer, Brian Wong. “They provide portfolio managers with an effective tool to hedge out beta risk.”

Free float market capitalization, expressed in USD, is used to determine the weights of the underlying assets in the BBAX. The asset weightings for the current quarter are: ETH, 40%; XRP, 34.1%; LTC, 13.1% and EOS, 12.8%. Asset weighting is set at the beginning of each quarter and will remain constant throughout the quarter. The index will be rebalanced on a quarterly basis so that it reflects the underlying assets’ market performance.


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