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Coinbase launches COIN50 index to promote cryptocurrency index investing

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Coinbase launches COIN50 index to promote cryptocurrency index investing

The U.S. compliant cryptocurrency exchange Coinbase launched the COIN50 index, representing the top 50 digital assets listed on Coinbase. The COIN50 index can also be traded as perpetual contracts with leverage of up to 20x.

What is the COIN50 Index

The COIN50 Index is a market-cap weighted index of the top 50 assets listed on Coinbase that meet its index standards, with a maximum asset cap of 50%. As of the rebalancing on August 27, the weights of the index are as follows:

  • Bitcoin: 50%
  • Ethereum: 28.8%
  • Solana: 6.4%
  • XRP: 2.9%
  • Dogecoin: 1.4%
  • The remaining 45 assets collectively make up 10.4%.

The Coinbase 50 Index is rebalanced quarterly, allowing traders to track the performance of a broader cryptocurrency market and measure their returns using this index. While the index currently covers around 80% of the total cryptocurrency market capitalization, Coinbase emphasizes the importance of index investing and believes this product is just the beginning.

COIN50 also offers perpetual contract trading

Qualified traders will be able to trade the COIN50 perpetual futures contract, COIN50-PERP, tracking the Coinbase 50 Index. Institutional users can use up to 20x leverage on the Coinbase International Exchange, while eligible retail users can trade on Coinbase Advanced. This contract is only available to users in jurisdictions outside the U.S., U.K., and Canada.

David Duong, Coinbase's head of research, stated that the cryptocurrency industry is still in its "early" stages. The global cryptocurrency market currently stands at around $3 trillion, representing only 3% of the total global stock market capitalization of over $101 trillion. Duong said:

We see demand from investors for index investing, as indices can evolve with the enduring changes in the cryptocurrency trends and capture a broader market representation. Index investing is popular for a reason—it provides a simple way to gain diversified exposure and capture the structural changes in market trends.