This headline cryptocurrency index comprises the volume-weighted average price (“VWAP”) on the top 200 cryptocurrencies except for Bitcoin and stablecoins, by market capitalization, in USD. The index provides exposure to the broader cryptocurrency market by incorporating the cryptocurrencies that represent the global cryptocurrency market without the influence of Bitcoin, a cryptocurrency dominating ~51% of total market capitalization at the time of writing.
Pricing data for the index is provided by CoinMarketCap, the leading cryptocurrency data provider in the world. CoinMarketCap calculates market capitalization for each cryptocurrency as “price multiplied by circulating supply”. The circulating supply metric used by CoinMarketCap accounts for locked, reserved or non-saleable coins or tokens that cannot affect the price of a cryptocurrency, and hence are not factored into a cryptocurrency’s market capitalization. Using circulating supply to determine market capitalization for cryptocurrencies is analogous to using public float to determine market capitalization of publicly listed companies.
The index is rebalanced on the last day of each calendar quarter. Index constituent weights are fixed on the selection date, which is five days prior to the rebalancing date. At this time, all eligible cryptocurrencies are ranked by their current market capitalization. This ensures growing or shrinking cryptocurrencies are accurately represented in the overall index. At any time, if a cryptocurrency is no longer eligible for membership, a replacement is named at the next scheduled rebalancing. The VWAP for each cryptocurrency incorporates pricing data from over 200 licensed exchanges, weighted by trading volume.
The index is calculated and administered by Solactive AG, an independent index provider based in Germany. Solactive develops, calculates and markets indices in multiple asset classes and complies with IOSCO Principles for Financial Benchmarks. The index is sponsored by CoinMarketCap, an independent, unbiased provider of cryptocurrency pricing with history on over 3,000 cryptocurrencies dating back to 2013. CoinMarketCap is the most-trafficked site in the world for cryptocurrency information, with over 125 million people in 2018 relying on CoinMarketCap as the most-trusted reference price for cryptocurrencies.