Bloomberg announced last week the launch of the Bloomberg Bitcoin & Gold Blend Indices, it says some of the first multi-asset indices to market that combine commodities and digital assets components. The new indices include the Bloomberg Bitcoin and Gold Equal-Weighted Index (BBIG), and the Bloomberg Dollar, Bitcoin and Gold Equal-Weighted Index (BBUG).
Bloomberg says, after a landmark year for cryptocurrencies in 2024, the impact of favorable regulations and sentiment shepherded in over $220bn in crypto investments according to Bloomberg data. These assets were across 250+ ETFs, including those linked to spot Bitcoin and spot Ethereum which expanded access to crypto markets using a familiar wrapper. Gold and Bitcoin both reached new peaks over the year, further bonding the relationship between digital and physical assets, and investors began to explore their competing and complementary attributes in diversified portfolios.
Bitcoin and Gold blends are the first in this set of indices, developed with a unit-based framework allowing for future modification and customization of building blocks and weight based on client interest, added Bloomberg. These indices aim to capture Bitcoin’s growth, coupled with Gold’s historic stability. The BBUG Index combines the U.S. Dollar’s defensive attributes with Bitcoin and Gold’s potential, long-term uncorrelated characteristics. Bitcoin and Gold have historically a nearly zero correlation with each other but maintain positive long-term returns making their basket a potential positive diversifier to traditional multi-asset portfolios, Bloomberg continued.
“We expect the Bloomberg Bitcoin and Gold basket to be the first of many commodities and digital asset blends as we see an increasing investor appetite for tailored indices that can target specific investment objectives and return profiles,” said Jigna Gibb, head of commodities & crypto index products at Bloomberg Index Services Limited. “With Bloomberg Indices’ capabilities, we’re able to continuously customize index offerings as the industry evolves. As a key investment hurdle in Bitcoin is elevated volatility, we see a fundamental case for using Bitcoin and Gold, not Bitcoin versus Gold.”
Bloomberg says it provides an independent, transparent approach to indexing for customers across the globe. Bloomberg clients can access the new indices on the Bloomberg Terminal at {IN BDXY<GO>} and all research and methodology for the indices are available on the Bloomberg Indices Documentation page.
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