MV Index Solutions (MVIS), a subsidiary of global investment manager VanEck, in partnership with CryptoCompare, a leading provider of digital asset data, launched the MVIS CryptoCompare DeFi 20 Index (Bloomberg ticker: MVDEFI) on Monday (April 19).
The MVIS CryptoCompare DeFi 20 Index is a modified market cap-weighted index which tracks the performance of the 20 largest and most liquid decentralized finance (“DeFi”) protocols. The index applies most demanding size and liquidity screenings to potential index components to ensure investability. The digital assets classified by CryptoCompare as DeFi as of the announcement date qualify for inclusion.
Thomas Kettner, the Chief Operating Officer of MVIS, had this to say:
“Our new DeFi index covers one of the most interesting and fastest growing trends in digital assets. Investors now have an instrument to benchmark a sector which is often referred to as the future of finance.“
And Charles Hayter, Co-Founder and Chief Executive Officer of CryptoCompare, commented:
“With the surge in popularity of DeFi projects and growing appetite from institutional investors, the MVIS CryptoCompare DeFi 20 Index makes this new asset class more accessible and offers investors an entry point to gain exposure to the top DeFi protocols.“
Here are the key features of the MVIS CryptoCompare DeFi 20 Index:
- Size and liquidity Requirements: Top 20 Decentralized Finance protocols by size and liquidity. The monthly average-daily-trading volume must be at least $1 million at review.
- Diversification: Component weightings are capped at 15%.
- Review frequency: Monthly
These are some of the main index parameters of the MVIS CryptoCompare DeFi 20 Index:
- Launch date: 19 April 2021
- Frequency of market cap updates: daily
- Calculator: CryptoCompare
- Currency: USD
- Current number of components: 20
- Base date: 30 June 2020
- Base value: 100
- Next review date: 30 April 2021
The current components of the MVIS CryptoCompare DeFi 20 Index are as follows:
So, how well has the DeFi sector, as measure by this index, performed?
Here are some some return-on-investment (ROI) figures (vs USD):
- Since inception date (30 June 2020): +914.82%
- Year to date (i.e. since 1 January 2021): +391.36%
- Past six-month period (i.e. since 22 October 2020): +637.88%
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.