One of the struggles that these new age crypto businesses and exchanges are facing is provided reliable, informative, analytical and secure tools for traders. While traditional business has slowly started opening up to cryptos one key contribution that is coming in is in terms of technology. In a recent addition to this list is the name of Nasdaq which is said to be building Tool to Predict Crypto Price Movements
Nasdaq using its technical muscle to churn out products for crypto
With a lot of institutions showing signs of moving towards cryptos, Nasdaq is moving ahead to give institutional investors an analytical edge by providing the products that could give them deeper insights into the crypto markets.
As reported by media, according to a person familiar with the company’s plans, the U.S. stock exchange is preparing to add tools for forecasting the price movements of crypto assets to its Analytics Hub. The hub, which was launched last year, combines machine learning and natural language processing capabilities to parse through social media and other alternative data sources to give investors a better way to assess market spikes and dips.
To date, the Analytics Hub has focused on traditional assets, but the addition of crypto seems to be another signal of Wall Street’s growing interest in the nascent sector. If the source is to be believed, the service would provide sentiment on some 500 crypto assets, and that it takes a three-pronged approach to its analysis, looking at fund flows via wallets, data from exchanges and social media.
“There’s the social media sentiment part, so applying machine learning and NLP, which will start with Twitter and might include StockTwits and then eventually perhaps Reddit,” the source said.
The news comes after Nasdaq CEO Adena Friedman said earlier this year that the company was looking into offering some sort of bitcoin futures product. Further, in April, she said Nasdaq would even consider creating a crypto exchange.
Not just Nasdaq many others are working on the same lines to woo institutional investments
In 2017 when the markets were soaring International Business Machines (IBM), had made a big push in offering enterprise blockchain systems. Known as Blockchain as a Service, the new service was based on the Linux Foundation’s Hyperledger Fabric version 1.0.
In March leading global data management and analytics company, Thomson Reuters had expanded its Data Feed to track sentiment data of top 100 cryptocurrencies. The new data feed based on Thomson Reuters MarketPsych Indices uses machine learning and text analysis to quantify key themes and sentiments likely to influence price trends of top 100 cryptocurrencies.
Similarly, in May this year, Bloomberg, together with Galaxy Digital Capital Management LP, a leading digital asset management firm founded by Michael Novogratz, launched the Bloomberg Galaxy Crypto Index (BGCI). The creation of the index marked an important step in the evolution of the digital assets space, facilitating diversified exposure as well as independent benchmarking for investors.
With some of the leading traditional finance players laying their hand on crypto data analytics and creating investor tools around cryptocurrencies, the crypto sphere will soon have a support system that will not just help investors predict prices but also curb down price manipulations and wrong activities.
Will these tools act as a building block towards getting institutional monies into cryptos? Do let us know your views on the same.
Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Follow him on Twitter at @KoinKing1 or connect with me on linkedin.