HKVAC’s Crypto Index Overhaul: Solana Surges Past Ripple in January Reshuffle

HKVAC’s Crypto Index Overhaul: Solana Surges Past Ripple in January Reshuffle

The Hong Kong Virtual Asset Consortium (HKVAC) has announced a significant revision to its cryptocurrency indexes, with changes set to take effect on January 19.

HKVAC Top 5 Restructuring

In the upcoming rebalancing, HKVAC will implement alterations across multiple indexes, including its central index, the HKVAC Top 5, as well as the Top 10 Index and the Global Large Cryptocurrency Index.

Solana Takes the Lead

Notably, the HKVAC Top 5 will witness the exclusion of several prominent cryptocurrencies. Solana (SOL), recognized for its remarkable market performance, is poised to replace Ripple’s XRP.

Despite Solana experiencing a severe setback in 2022 due to the FTX crypto exchange collapse, resulting in a staggering 95% price drop, it has staged an impressive comeback. Currently boasting a year-over-year surge of 436.5% and a market cap of $42.67 billion, Solana now secures its position as the fifth-largest cryptocurrency.

In contrast, XRP has shown more modest growth at 51.5% during the same period, and despite a valuation of $31.47 billion, it has slipped to the sixth position.

Global Large Cryptocurrency Index Changes

Additional adjustments made by HKVAC involve the removal of Filecoin (FIL), Binance USD (BUSD), Maker (MKR), Ivy (IVY), and TrueUSD (TUSD) from its Global Large Cryptocurrency Index. These removals pave the way for Near Protocol (NEAR), Internet Computer (ICP), Immutable (IMX), Optimism (OP), and Injective (INJ).

Significance of HKVAC’s Index Reevaluation

The reevaluation of indexes by HKVAC, a prominent assessor of digital asset trading platforms and crypto market indexes, serves as a crucial indicator of ongoing shifts in the crypto market. It not only mirrors the present market dynamics but also highlights potential growth areas, as recognized by industry experts.

For instance, Tron (TRX) has exhibited an impressive recovery from a bear market downturn between 2018 and 2020, achieving a 100% rally in 2023. Nevertheless, it is set to be replaced in the Top 10 index by Avalanche (AVAX), propelled by recent rallies and strategic partnerships with JPMorgan and Citi for asset tokenization initiatives.

Impact on Investment Decisions

Benchmark indices, such as those revamped by HKVAC, play a crucial role for investors in assessing the performance of digital assets. Consequently, these revisions can significantly influence investment decisions based on the visibility and perceived market strength of the included cryptocurrencies.

Aligning with Hong Kong’s Crypto Initiatives

HKVAC’s revision aligns with Hong Kong’s proactive approach to the cryptocurrency sector. This move coincides with preparations to introduce spot crypto ETFs into the semi-autonomous region, following the U.S. Securities and Exchange Commission’s (SEC) approval of 11 spot Bitcoin ETF applications.

The Securities and Futures Commission (SFC) of Hong Kong emphasizes the necessity for crypto transactions to be conducted through licensed platforms or authorized financial institutions, ensuring regulatory compliance and safeguarding investor interests.

Leave comment

Your email address will not be published. Required fields are marked with *.