State Street has launched a new Bitcoin Thematic Indicator series that quantifies media coverage of Bitcoin, measuring the intensity or prevalence relative to all news of the day, as well as the sentiment of news over a period of time.
State Street is increasingly active within the digital asset space. Expanding the State Street MediaStats Thematic Indicators offering, which was launched in November 2020 in partnership with MKT MediaStats, this indicator helps contextualize the rising popularity of Bitcoin and how it is impacting more traditional financial markets.
Rajeev Bhargava, head of the Investor Behavior Research Team at State Street Associates, said: “Over the last few months, media coverage around Bitcoin has grown significantly relative to corporate, financial, and economic media markets and continues to trend higher. Understandably, institutional investors are increasingly eager to learn how this rising attention is impacting traditional asset markets. Our newest Bitcoin series provides a quantitative and timely measure of the tone and intensity of media discussion and reveals additional transparency into this highly sentiment-driven market, enabling our clients to make more informed investment decisions.”
The new Bitcoin Indicator will capture vast information around the asset as well as its linkages to traditional currencies and emerging trends, which investors can leverage for portfolio planning and to gain indirect exposure through equity baskets.
The process includes analyzing hundreds of thousands of digital news sources to generate daily sentiment signals to help institutional investors form a more complete picture of what factors are driving their portfolios and overall markets.
Dr. Gideon Ozik, managing partner and founder of MKT MediaStats, said: “Our indicators are built on a decade’s worth of natural language processing research combined with a strong academic underpinning. Now, harnessing the power of vast data to provide real-time perspectives, we’re able to offer investors a tool they can leverage to make tactical and strategic judgments on key narratives that drive financial markets.”
State Street has most recently been appointed as the administrator of a planned bitcoin-backed exchange-traded note (ETN) initiated by Iconic Funds BTC ETN GmbH, further entering the digital asset space.
The second-oldest continually operating United States bank will support the issuance of the ETN by calculating the net asset value of the bitcoin portfolio consuming crypto market data from various crypto depositories. The ETN will be listed on the Frankfurt Stock Exchange, following the approval by BaFin.
State Street has also partnered, via its currencies trading platform Currenex, with Pure DIgital to set up its institutional-grade digital asset platform with trading commencing in 2021.