Japanese consulting firm Nomura Research Institute NRI partners with IU to launch a new cryptocurrency index

Largest Japanese consulting firm Nomura Research Institute (NRI) collaborated with the cryptocurrency investment solution provider Intelligence Unit (IU) to release a tradable cryptocurrency index.

According to a press published on Jan. 29, the new index’s name is NRI/IO Crypto-Asset Index and it will be used by financial institutions. The index also draws data from the crypto index platform MVIS and major cryptocurrency data platform CryptoCompare.

The website explains that the index is meant to include global crypto markets in U.S. dollars and Japanese yen by watching the largest cryptocurrencies. The index was designed for Japanese institutional investors with consideration for local availability and custody solutions.

A tradable index can track 5 leading cryptos

The NRI/IO Crypto-Asset Index is rebalanced every month and tracks the performance of a pre-defined basket of crypto assets, and will be tradable in dollars and yen on NRI’s platform. The index includes Bitcoin (BTC), Bitcoin Cash (BCH), Ether (ETH), Litecoin (LTC) and XRP.

IU CEO Akihiro Niimi commented on the launch that strong demand from institutional investors is contributing to the rise of digital asset funds, and various products like index funds are attractive as alternative investments.

Backtested performance statistics presented on the website claim that the year-to-date performance is 33.91%, the one-year performance is 104.86% and the three-year return is 2,211.26%.

NRI is a branch of Japanese financial services giant Nomura Holdings, which has adopted blockchain technology and provided several crypto-asset services.

In 2018, Nomura conducted cryptocurrency custodial services at its banks, which aimed to solve a perceived shortage of “safekeeping solutions” which were preventing traditional asset managers from building investment vehicles in the crypto ecosystem. In 2019, the firm and popular Japanese messaging app Line announced a capital alliance agreement focused on blockchain technology.

The rising of crypto derivatives

When cryptocurrencies become more widely recognized as an asset class, a rising number of firms are developing derivatives giving exposure to their price fluctuations. For example, Swiss cryptocurrency financial firm Amun AG launched an exchange-traded product giving investors inverse exposure to Bitcoin on leading Swiss Exchange SIX.

However, while many claim that there is a clear demand for cryptocurrency derivatives, the latest statistics may show different. It is reported that little more than a month after their launch, Bitcoin options contracts on the Intercontinental Exchange’s digital asset platform Bakkt appear to have seen sluggish uptake, with no new trades occurring over the past 11 days.

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