S&P Dow Jones has officially revealed that it would be launching its cryptocurrency indices by next year, becoming the latest major financial institution to enter the digital currency market.

S&P Dow Jones Indices, a division of financial data provider S&P Global, revealed yesterday that it would be launching cryptocurrency indices by 2021. According to the Reuters report, S&P Dow Jones Indices is partnering with New York-based virtual currency company Lukka to use their data for their products.

The cryptocurrency indices will measure the performance of more than 550 leading cryptocurrencies by market cap. Both companies’ statements reveal that S&P’s clients would be granted access to numerous benchmarking tools that would allow them to create customised indices on cryptocurrencies.

While talking to Reuters, global head of Innovation and Strategy at S&P Dow Jones Indices, Peter Roffman, stated that cryptocurrencies becoming a rapidly emerging asset class means that the time is right to create independent, reliable and user-friendly benchmarks.

S&P Dow Jones’s entry into the cryptocurrency market comes from a place of confidence. The joint statement by S&P Dow Jones and Lukka revealed that they are confident cryptocurrencies would achieve mainstream investment status by next year.

S&P and Lukka are hopeful that by providing more reliable pricing data, it would be easier for investors to access the new asset class. It would also help the clients to assess some of the relative risks associated with the volatile and speculative market.

S&P becomes the latest financial institution to enter the cryptocurrency market. Other leading financial companies like Fidelity Investments and Japan’s Nomura Holdings have already started offering cryptocurrency services to their institutional investors. Some major exchanges such as the New York Stock Exchange (NYSE) through its subsidiary, Bakkt, offer numerous cryptocurrency services to users globally.

Not so long ago, Bitcoin and other digital currencies were shunned away by the large financial institutions. However, several of them, including JPMorgan, have had a change of heart and are now offering various crypto services to their clients.

Payment processing company, PayPal, entering the market has made it easier for millions of people globally to access the leading cryptos such as Bitcoin, Litecoin, Ethereum and Bitcoin Cash.

Deutsche Bank recently made a case for banks and other financial institutions to offer cryptocurrency services. The bank revealed that investors are increasingly choosing Bitcoin over gold to hedge the US dollar and protect themselves against inflation.

S&P wouldn’t be the last financial institutional to launch a cryptocurrency product as more companies are expected to enter the crypto market next year.

The post S&P Dow Jones to launch crypto indices in 2021 appeared first on Coin Journal.

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