Binance announced this Monday (17) in partnership with CoinMarketCap a new index of Bitcoin and 9 other cryptocurrencies for the market, excluding stablecoins in its index.
called “Binance CMC Top 10 Equal Weighted IndexThe index arrives as the first of a series to be released by the brokerage soon.
In 2021, Binance bought CoinMarketCap and started creating campaigns in partnership with the popular tool that collects numerous products.
In fact, one of the functions of the new index may be to serve as a reference for ETFs in the future, a derivative that may be on the broker’s radar.
New Binance Index in Partnership with CoinMarketCap of Bitcoin and 9 Other Cryptocurrencies
Several traders follow the “market cap” basis of cryptocurrencies, which measures the supply of coins by their dollar price. Since the method was created, bitcoin has never left the first position as it is not only the safest currency, but also the best known and traded in the world.
According to Binance, the new index will track the top ten cryptocurrencies by market capitalization against the dollar. The index rebalances monthly, giving investors an idea of the behavior of this market.
“The new index tracks the performance of the top 10 digital assets by market capitalization against its base currency, the US dollar. The basket of 10 digital assets has the same weight and is rebalanced monthly. The market cap of a digital asset is calculated by multiplying the dollar price by the current circulating supply.
To improve understanding of the market, this first index will not include stablecoins in its analysis, excluding currencies such as Tether, USD Coin and Binance USD.
Automatic purchases of cryptocurrencies listed in the index
In addition to the novelty launched by Binance, the Auto-invest product will soon have the ability for customers to automatically buy cryptocurrencies that are in the top ten of the index.
In this way, those who are interested in having a little bit of each of the ten largest cryptocurrencies in their portfolio, using the DCA (average price in dollars) method, can buy them through Binance.
It is not yet clear whether the highest volume brokerage in the world plans to launch in the future an ETF linked to the new indices, which is to be created so that investors have different products to invest in, a product that are not yet available to Brazilians, as the CVM prohibits Binance from offering derivatives in Brazil.
The broker’s plan is to launch new indices by 2023.
Source: Live Coins
John Cameron is a journalist at The Nation View specializing in world news and current events, particularly in international politics and diplomacy. With expertise in international relations, he covers a range of topics including conflicts, politics and economic trends.
