The function of benchmarks is to describe and measure markets. Providing transparent rules, documented governance, independent oversight and clear procedures in stressful situations requires rigor and discipline. Index providers adopt these disciplines voluntarily, based on standards honed over decades in other asset classes.
A new report from the Index Industry Association examines how digital asset indices are evolving to meet these expectations, and must continue to evolve as stablecoins and tokenized assets enter the scene. Transparency is rarely the loudest part of a market, but it tends to be the part that lasts.
Principled Perspectives
One Market, Not Two: CoinDesk’s Dave LaValle on the Convergence of Crypto and TradFi
The conversation about cryptocurrencies in client portfolios has changed over the past six months, and advisors who still think in terms of the old framework risk being caught off guard. In a new interview with The Wealth Advisor, Dave LaValle, president of CoinDesk Data & Indices, explained why.
The clearest signal came from Wall Street. “The Morgan Stanley team launched its bitcoin ETF in early April, and just over a month later, it has over $230 million in assets,” LaValle said. “To accumulate $230 million in basically one month, it’s kind of crazy.”
He framed cryptocurrencies as a disruptive technology that needs two things to take hold: the technology itself, which exists, and regulatory clarity. The GENIUS Act has established a framework for stablecoins backed by US Treasuries, and the CLARITY Act, which addresses market structure, could come up for a vote “sometime in the next month or two.”
