Bloomberg and Galaxy Digital have Teamed up For new DeFi Index

In Brief: 

• Bloomberg announced a partnership with Galaxy Digital to develop the Bloomberg  Galaxy DeFi Index (DEFI). 
• The Index will track the most valuable decentralised finance (DeFi) protocols in terms of market capitalization.

As per the 19th August report, Bloomberg, which is a global business, has announced that it has teamed with Galaxy Digital once again. Bloomberg and Galaxy Digital announced the debut of the Bloomberg Galaxy Decentralized finance (DeFi) Index, which expands their crypto offering. 

The aim of the benchmark is to evaluate the performance of the most valuable DeFi protocols. It is done to provide financial services without a central financial intermediary like brokerages, exchanges, or banks. Bloomberg Index Services Limited owns and administers the benchmark, partnering with Galaxy. 

Alan Campbell, Head of Product Management for Bloomberg’s Multi-Asset Index division, said, “Decentralized finance is growing as the next major investment theme within crypto.” He further added by saying that “As liquidity and institutional custody solutions continue to grow, DeFi has become an increasingly compelling option for institutional investors, and we’ll continue working with Galaxy to expand our crypto index offering.”  

“Galaxy continues to pioneer inroads for institutions seeking exposure to the innovation happening within the crypto ecosystem,” Steve Kurz stated, Partner and Head of Asset Management at Galaxy Digital. “This partnership with Bloomberg and our DeFi Index Fund provides investors with data and tools that deliver calculated exposure to the future of financial services,” he further added. 

The Index is comprised of the following assets and weightings as of August 1, 2021: 

1. 40% UNI
2. 18% AAVE
3. 12.7% MKR
4. 10% COMP
5. 5.4% YFI
6. 5% SNX
7. 4.3% SUSHI
8. 1.8% UMA
9. 2.8% ZXR 

DEFI’s component is chosen on the basis of institutional trading and custody preparedness in the United Statesprice quality. No one constituent will own more than 40% of the Index, and no single constituent will own less than 1%. The DeFi protocol is examined on a monthly basis for inclusion or exclusion from the Index. 

Also Read: Grayscale Partners with Coindesk to Launch New DeFi Fund and Index

With the Bloomberg-Galaxy Crypto Index, Bloomberg and Galaxy established the Bloomberg-Galaxy Crypto Indices in 2018. (BGCI). The BGCI is a market capitalization-weighted index that tracks the performance of the most popular digital assets traded in US dollars. 

Also, Bloomberg clients can access the index using the ticker DeFi Index.  

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