The Dow Jones Crypto Index

The year 2021 will possibly be noted as the year when the world recognizes mainstreaming of cryptocurrencies as the first possible type of blockchain based assets in markets. The signal from Dow jones a reputed industry standard for indices and a powerful market determinant – about launching a separate cryptocurrency index will possibly be a silver lining in the otherwise grey cloud. While the Dow Jones index is a critical factor, what remains to be seen is whether mainstream brokerages, traders and other financial actors like banks in the US will make crypto a part of their portfolio of products.

It is already known that major banks in Japan – an economy struggling from negative inflation- seems to have found solace in the growth of at least one financial asset I.e., cryptocurrency. The main Nomura holdings bank in Japan accepts cryptocurrency deposits directly and provides customers with dual accounts – one for cash or other assets and another for cryptocurrency based holdings.

One of the key factors that has been lacking till date in the cypto-space was an index from a reputed and established firms on Wall Street, that can be used for benchmarking existing asset portfolios. Of course, private indices did exist e.g., such as the index. The CCI30 was definitely one of the best indices that existed ever, but it was possibly inefficient as a baseline. The DJIA indexes 30 largest stocks by market capitalization.

Hopefully the mainstream banking and stock trading firms will pay heed to this sector. It is a known fact that most ultra HNIs, Family offices and others have invested in this sector. Many of those who used to condemn this sector as vapor ware as late as 2016 have now started accepting the value of this sector overall.

That being said, whenever regulations catch up globally to protect the assets of citizens by preventing fraudulent asset issuance, then blockchain based assets would be much sought after.