Altcoins News

Story: S&P’s New Index Tracks Blockchain Protocol Revenue Across 4 Major Networks

By Evie Vavasseur

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Protocol Revenue Over Market Cap. The methodology is pretty straightforward, at least in concept.

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What This Means for Institutional Investors. Institutional money has been circling crypto for years, but a recurring complaint from allocators…

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Open Questions and What's Missing. S&P Global hasn't said whether the index will expand to include additional metrics beyond…

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S&P Global just launched something genuinely different. The Blockchain Fundamentals Index ditches market cap as the primary lens and instead tracks digital assets based on…

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That's a bigger deal than it sounds. Almost every major crypto index on the market today weights holdings by market capitalization, which basically means bigger gets more weight,…

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The methodology is pretty straightforward, at least in concept. Instead of asking "how large is this network's market cap," the index asks "how much revenue is this protocol…

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S&P Global's pitch to investors is that protocol revenue gives you a cleaner read on a network's earning power.

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It's worth being honest about what this means in practice. A network can have a massive market cap and minimal fee revenue.

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Not everyone will immediately get it, though. Protocol revenue as a concept requires some explanation. It's not the same as a company's net income.

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See also: Dogecoin Whale Drops $14 Million as Musk Meme Like Stirs Speculation

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An index built around protocol revenue starts to close that gap. It gives analysts something to model.

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There's also a secondary effect worth watching. If this index gains traction, it could quietly reshape incentives for blockchain projects themselves.

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It's also unclear how frequently the index rebalances, how it handles networks that see sharp swings in fee revenue quarter to quarter, or what the minimum revenue threshold…

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See also: Bitcoin ETFs See Six-Day Streak of Positive Inflows, Collecting $930 Million

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And people probably will. Index products tend to spawn ETFs, structured notes, and benchmarked funds once they build credibility.

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