This Bermuda-based ETF illustrates exchange giant Nasdaq’s broader crypto ambitions

• A crypto ETF begins trading on the Bermuda Stock Exchange on Tuesday.
• The product is based on Nasdaq’s Crypto Index.
• The launch itself highlights Nasdaq’s ambitions to power crypto-tied products.

From S&P Global to Cboe Global Markets, Wall Street firms are looking to launch index products that will serve as the basis for a crypto exchange-traded fund (ETF).

As of this morning, Nasdaq can claim that achievement. Nasdaq announced the debut of the Hashdex Nasdaq Crypto Index ETF, which is based on an index devised by the stock exchange operator.

The ETF will trade on the Bermuda Stock Exchange, available to a smaller pool of investors than it might have been in the United States. Still, the ETF’s release highlights the pace of progress for such products and the ambitions of data firms hoping to provide the informational foundations for them. Both S&P Global to Cboe announced their intention to launch crypto indexes that might one day underpin such products.

As for Nasdaq, the firm explored exactly how it might break into the crypto index market for several years before it began the development of the Nasdaq Crypto Index in July 2020.

In an interview with The Block, Sean Wasserman, global head of index and advisor solutions, said that Nasdaq wanted to create a benchmark for the industry that could “meet the needs of growing institutional interest.”

NCI

The Nasdaq Crypto Index was developed alongside Hashdex, which licenses the index across its funds offered in Brazil, according to Wasserman. Wasserman said Nasdaq wanted the index to uniquely capture the most liquid and most favorable crypto assets for large institutions. As such, Nasdaq outlined the key criteria required for a cryptocurrency – or constituent, in ETF terminology– to be included.