Bloomberg has partnered with financial services business Galaxy Digital to establish the Bloomberg Galaxy Defi Index.
Galaxy Digital, led by Mike Novogratz, partnered with financial news behemoth Bloomberg to establish a new crypto index focused on decentralized finance. Galaxy Digital’s fund platform, Galaxy Fund Management, announced on August 19 that it is now providing the Galaxy Defi Index Fund, a passively managed fund that tracks the sector’s performance.
To begin, the new index will track nine Defi tokens and serve as the foundation for Galaxy’s new passively managed fund. These tokens include Uniswap’s UNI (40 percent), AAVE (18 percent), Maker MKR (12.7 percent), Compound’s COMP (ten percent), Yearn Finance’s YFI (5.4 percent), Synthetix’s SNX (five percent), SushiSwap’s SUSHI (4.3 percent), and 0x Protocol’s ZXR (2.8 percent) (1.8 percent ). Notable omissions from the list include Chainlink (LINK), which many believe is not a Defi token in the first place, Curve DAO (CRV), and THORChain (RUNE).
Examining Defi
This is not the pair’s first crypto index; in 2018, they launched the Bloomberg Crypto Index to track the most liquid tokens in the cryptocurrency market. Bloomberg Index Services Limited owns and administers the new Defi benchmark, which is co-branded with Galaxy, according to the statement. Alan Campbell, Bloomberg’s head of product management for Multi-Asset Indexes, stated:
“Decentralized finance is growing as the next major investment theme within crypto. 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.”
Mike Novogratz, a former hedge fund manager, simply tweeted, “Defi is the future.” According to the statement, the tokens included in the Defi index were chosen based on their institutional trading and custody readiness in the United States, as well as their pricing quality.
Steve Kurz, Galaxy’s head of asset management, adding, “The blockchain-based infrastructure that powers Defi is evolving at a rapid pace, and concrete instances of how this new technology might disrupt financial services are appearing in real-time.”
On August 17, Galaxy Digital submitted another Bitcoin ETF proposal to the Securities and Exchange Commission, this time for a futures-only product. According to DappRadar, the total value frozen across the entire sector is currently $118 billion. DeFiPulse reports a far lower amount of $83 billion, whereas DeFiLlama reports a TVL of $151 billion.
Uniswap is the leading protocol on DappRadar with $14.2 billion in market capitalization, while the other two analytics platforms rank Aave first. Defi-related tokens are enjoying a strong day in terms of gains, with many increasing by double digits today, including CRV, BADGER, RUNE, SUSHI, and REN.
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