The SEC recently announced its decision to streamline crypto ETF approvals, opening the door to a flood of new launches. Analysts now expect digital asset ETFs to overtake precious metals as the third-largest ETF category globally.
To create a successful ETF launch, robust and reliable index and benchmark data is essential, even more so in these newer asset classes where the underlying data is often more fragmented and challenging. Drawing on its longstanding experience in traditional asset class data management, Rimes is ideally placed to help its clients better manage the required digital asset data.
The key drivers for the scale and speed of crypto ETF growth are:
- Diversification: investors are looking for multi-asset and thematic indexes, not just Bitcoin
- Institutional demand: pension funds, sovereign wealth funds and insurers are all looking at allocating assets to these newer investments
- Regulatory tailwinds: standardized listing requirements help to reduce time to market for new product launches
However, with analysts forecasting billions in new index-related spending in the next five years and each ETF requiring index licensing, methodology governance and ongoing data services, the demand for associated data is immense. In addition, each ETF can generate related new products such as structured notes, options and tokenized funds, all of which also rely on quality benchmark data. Some traditional index providers, though often constrained by legacy processes, have started to slowly expand into covering digital assets, while crypto-native index firms may look innovative but can often lack institutional trust.
So, what’s the answer?
With its decades of experience of delivering quality data, strong institutional relationships and innovative approach to solving its clients’ data management problems, Rimes is ideally placed to deliver the digital asset index data needed. Rimes’ rigorous processes and modular approach, combined with strong ETF issuer and custodian partnerships, allows asset coverage to be swiftly added as required while ensuring strict governance and compliance protocols. Rimes provides the framework its partner issuers trust to deliver reliable, compliant, and innovative benchmarks for the crypto ETF market.
Conclusion
Regulatory change, investor appetite and product innovation are all driving the demand for digital asset ETFs, in turn driving the need for quality benchmark and index data.
With Rimes already delivering digital asset index data to its clients today, it is rapidly positioning itself as the leader in these exciting markets. To learn more, contact us today.
